U.S. Deficit Falls As Tariff Boom Offsets Record Debt Payments

Benzinga

The U.S. deficit fell 2.2% to $1.78T in 2025 as record $202B in tariff revenues offset record-high $1.2T interest costs. The shortfall equaled 5.9% of GDP, the lowest since 2022, amid Fed signals of rate cuts.

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00:00It's Benzinga, bringing Wall Street to Main Street.

00:02U.S. budget deficit narrowed to $1.78 trillion in fiscal 2025, down 2.2% from the previous year

00:08as record tariff revenues offset soaring interest costs, and according to CNBC,

00:14tariff collection surged 142% to $202 billion under Trump's trade policies,

00:19marking a key factor in this smaller shortfall.

00:22That was equal to 5.9% of GDP, the lowest since 2022,

00:26will interest payments on the $38 trillion national debt in a record $1.2 trillion,

00:31surpassing the Fed spending.

00:33Government collected $5.2 trillion in revenue and spent just over $7 trillion for the fiscal year

00:38as the Fed signal rate cuts to ease financing pressure.

00:41For all things money, visit Benzinga.com.

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