Business & Markets
U.S. posts a $432 billion July budget deficit as spending outpaces receipts
Treasury data show the monthly shortfall rose sharply from a year earlier while net customs-duty receipts turned negative in July.
Executive summary
- The shortfall: The federal government recorded a $432.3 billion budget deficit in July, with $334.0 billion in receipts and $766.3 billion in outlays.[1][2]
- The comparison: The July deficit was about 48% larger than the $291.1 billion shortfall recorded in July 2025.[1][2]
- The fiscal year: The deficit reached $1.799 trillion through the first 10 months of fiscal 2026, compared with $1.775 trillion over the same period a year earlier.[1][3]
- The tariff line: Net customs-duty receipts were negative $8.5 billion in July even as the fiscal-year total remained positive at $154.5 billion.[4][2]
The United States posted a $432.3 billion federal budget deficit in July as monthly spending reached $766.3 billion and receipts totaled $334.0 billion, according to Treasury data released this week. Reuters reported that it was the largest monthly shortfall since March 2021.[1][2]
The gap was about 48% wider than in July 2025, when the government recorded a $291.1 billion deficit on $629.6 billion in outlays and $338.5 billion in receipts. The comparison shows that higher spending, rather than a broad collapse in monthly receipts, accounted for most of the year-over-year increase.[1][2]
Through July, the first 10 months of fiscal 2026, the cumulative deficit stood at $1.799 trillion. Treasury's comparable figure for the same period of fiscal 2025 was $1.775 trillion. A Congressional Budget Office review released before Treasury's final monthly statement likewise estimated a roughly $1.8 trillion deficit through July and said fiscal-year revenues had risen 3% while outlays increased 5%.[1][3]
Treasury's detailed accounts show that net customs-duty receipts were negative $8.5 billion for July, while the fiscal-year total remained positive at $154.5 billion. Reuters attributed the monthly reversal to tariff refunds, which offset collections during the month.[4][2]
Gross interest on Treasury securities reached $117.6 billion in July and $1.170 trillion for the fiscal year to date. Those figures are gross payments and should not be confused with net interest after the government accounts for interest received by federal trust funds and other intragovernmental holdings.[4]
The monthly figures can swing with tax-payment calendars, benefit schedules and one-time accounting changes, so July alone does not determine the full-year result. The final fiscal 2026 deficit will depend on August and September receipts and spending, as well as any later accounting adjustments recorded by Treasury.[3][1]