The US Treasury Department reported that the federal budget deficit in July surged to 432 billion dollars, the highest on record for the month of July, as government spending rose while customs revenue fell further into negative territory. The cumulative deficit for fiscal year 2026 climbed to 1.799 trillion dollars, already exceeding the full-year deficit for fiscal 2025 even though two months remain before the fiscal year ends. The July deficit rose by 141 billion dollars, or 48 percent, from July 2025, and was the largest monthly deficit since March 2021, when the United States ran a deficit of 660 billion dollars due to spending on COVID-19 relief programs. Government spending in July, before adjustments for various factors, set a record for the month at 766 billion dollars, up 137 billion dollars, or 22 percent, from a year earlier. However, the July deficit was partly affected by a calendar shift in benefit payment dates, with spending running about 99 billion dollars above normal because the government had to pay a large portion of August 2026 benefits early in July, since August 1 fell on a weekend.
