US July deficit tops $432 billion as outlays grow, tariff receipts stay negative

Unadjusted July receipts were down $4 billion, or 1%, to $334 billion. This included an $8.55 billion outflow of net customs receipts after tariff refunds totaling $33.38 billion for the month.

For the first 10 months of fiscal 2026, which began Oct. 1, 2025, the unadjusted deficit totaled $1.799 trillion, up $170 billion, or 10%, from the $1.629 trillion reported for the year-ago period. The year-to-date deficit exceeded the full-year fiscal 2025 deficit of $1.775 trillion with two months left in the fiscal year.

The U.S. federal budget deficit for July jumped to $432 billion, a record for the month, as higher outlays and more negative tariff revenues also brought the 2026 fiscal-year-to-date budget gap to $1.799 trillion, topping the full fiscal 2025 deficit with two months left in the fiscal year, the U.S. Treasury said on Wednesday.

The budget gap for July, which was partly inflated by calendar shifts in benefit payments, was $141 billion, or 48% higher than in July 2025 and was the largest monthly deficit since March 2021, when it hit due to COVID-19 relief programs.