US FY2026 Deficit Widens to $1.99 Trillion as Interest Costs Top $1 Trillion
The US budget deficit reached $1.99 trillion in fiscal 2026, up 12% from $1.78 trillion a year earlier, while net interest costs crossed $1 trillion.
The US fiscal deficit widened to $1.99 trillion in FY2026, a 12% increase from $1.78 trillion in the prior year. Government spending rose 6% to $7.4 trillion over the same period.
Net interest expenses climbed above $1 trillion, making debt servicing the third-largest federal expense after Social Security and Medicare.
This marks the fourth consecutive year that the deficit has been running around $2 trillion.
Source: The Kobeissi Letter