Deficit to Shrink Below $1 Trillion, U.S. Agency Predicts

The federal budget deficit will total $845 billion this year, the first time in five that the gap between taxes and spending will be less than $1 trillion, according to a government report.

A combination of budget cuts and economic growth will pare the deficit to the lowest level since 2008, the Congressional Budget Office said in its first comprehensive analysis of the government’s finances since last month’s deal to put off the so-called fiscal cliff. Next year’s gap will be $616 billion, the nonpartisan agency said.