Sept. 2 (UPI) -- The Congressional Budget Office on Wednesday said the federal budget deficit is expected to reach $3.3 trillion for the fiscal year and for debt to surpass the economy in fiscal year 2021.
The 2020 federal budget deficit is more than triple the shortfall recorded in 2019 and at 16% of the gross domestic product would be the largest since 1945, the CBO said in its budget outlook for 2020-2030.
"That increase is mostly the result of the economic disruption caused by the 2020 coronavirus pandemic and the enactment of legislation in response," the CBO said.
CBO's latest estimate of the deficit for 2020 increased by $2.2 trillion from its prediction in March, at the onset of restrictions related to the pandemic in the United States.
The CBO also said the deficit in 2021 is projected to be 8.6% of the GDP, the first time the federal debt has surpassed the nation's annual economic output since 1946.
As a result of the deficits, the CBO said that federal debt held by the public will rise to 98% of GDP in 2020 compared to 79% in 2019 and will exceed 100% in 2021.
By 2023, federal debt held by the public is set to rise to 107%, the highest since World War II.
Further, the CBO said that annual deficits relative to the size of the economy are generally projected to decline through 2027 before increasing again in the final years before 2030 when it will reach 5.3% of the GDP.Sign up for our daily Top News Newsletter