expenditures are 24.1% of GDP while revenues are 11.5% of GDP: expenditures remain higher than revenues
expenditures have shrunk faster than revenues vs previous quarter
IntroHere we monitor the US revenues and expenditures to understand fiscal policy. Fiscal policy involves using government spending and taxation to influence the economy.
RevenuesGovernment revenues primarily come from taxes (income tax, corporation tax, VAT, etc.), but can also include other sources like customs duties, fees, and sales of goods and services.
Adequate revenue is essential for funding public services, paying government obligations and potentially investing in infrastructure and other areas.
ExpendituresGovernment spending covers a wide range of areas, including healthcare, education, defense, social security, infrastructure and debt interest payments.
Expenditures can be categorized as current (day-to-day running of public services) or capital (investments in long-term assets).
Market implicationsHigher fiscal spending tends to stimulate economic growth and therefore support regional equity markets, while lower fiscal spending tends to limit economic growth at detriment of equity markets. But it is also a way to manage and control the explosion of financial debt and therefore tends to support bond markets.
US fiscal balance
US public finances
monitoring fiscal & primary balance
How much is the US's fiscal balance?
Latest available data as of: Q3-2025
US fiscal balance
it is at -12.6% of GDP
the deficit is lower vs previous quarter (was at -13.3%)
such deficit remains high
US primary balance
it is at -7.9% of GDP
the deficit is lower vs previous quarter (was at -8.5%)
such deficit remains high
Conclusions
the US has spent a lot of money so far to support the economy
spending has gone down vs previous quarter: the fiscal balance shows a lower deficit (with shrinking expenditures and increasing interest expense), and the primary balance shows a lower deficit
IntroHere we monitor the US fiscal and primary balanceas measures of fiscal policy. Fiscal policy involves using government spending and taxation to influence the economy.
Fiscal balanceFiscal balance is the difference between revenues and expenditures for a given fiscal period. A positive fiscal balance indicates a surplus, meaning the government collected more revenue than it spent, while a negative balance indicates a deficit, meaning it spent more than it collected.
Primary balanceThe primary balance is a measure of a government's financial health: it is the difference between its revenue and its non-interest expenditure. In other words, it is equivalent to the fiscal balance after adding back the interest paid on financial debt.
Chart guideIn the chart we show the fiscal balance and the primary balance together.
Market implicationsHigher fiscal spending tends to stimulate economic growth and therefore support regional equity markets, while lower fiscal spending tends to limit economic growth at detriment of equity markets. But it is also a way to manage and control the explosion of financial debt and therefore tends to support bond markets.