The federal government's deficit from October through July totaled $US460. 45 billion ($496. 74bn), down 24 per cent from the same period a year earlier, the US Treasury Department said.
The deficit hit its latest peak of $US1. 4 trillion in 2009 but has since shrunk, due to a combination of a slowly improving economy, greater tax receipts and an easing of government spending gains.
The CBO projects that after narrowing again next year the deficit will begin to expand later in the decade and again top the $US1 trillion mark by 2023.
For July, Treasury reported a $US94. 59bn deficit, down 3 per cent from the same month a year earlier.
Tuesday's report showed federal receipts grew 8 per cent from a year earlier to $US2. 469 trillion in the first 10 months of the year.
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