The budget deficit increased by 40% in December compared to the same month the previous year.

• The fiscal year 2025 deficit increased by 39.4% to $710.9 billion, which is $200 billion higher than the previous year's three-month period.
• The national debt has surpassed $36 trillion due to the confluence of rising financing costs, increased spending, and decreasing tax revenues, resulting in a spiraling deficit.

During December, the federal budget's deficit for the first fiscal quarter increased by nearly 40% compared to the previous year, as it sank further into red ink.

The Treasury Department reported that the shortfall for the final calendar month of 2024 totaled $86.7 billion, representing a 33% decline from the same period a year prior. Despite this, the three-month fiscal year total reached $710.9 billion, which is $200 billion more than the comparable period in the prior year, or 39.4%.

The national debt has surpassed $36 trillion due to the confluence of rising financing costs, increased spending, and decreasing tax revenues, resulting in a spiraling deficit.

Despite the stability of short-term Treasury yields in the past month, long-term rates have increased significantly. The 10-year benchmark note recently yielded approximately 4.8%, which is 0.4 percentage points higher than its yield a month ago.

While receipts decreased by 2% in the first quarter, outlays increased by 11% compared to the previous year.

In 2025, the national debt's interest costs reached $308.4 billion, a 7% increase from the previous year. The projected financing costs for the year are expected to surpass $1.2 trillion, breaking the 2024 record.

This year, the government has spent more on interest payments than any other category except for Social Security, defense, and health care.