Yesterday, the U.S posted a budget deficit for a record 18th straight month in March, reflecting gains in government spending to bolster the economy. The excess of spending over revenue declined to $65.4 billion last month, compared with the $220.9 billion reported last month, according to Treasury Department figures released yesterday in Washington.
A deficit that’s forecast to reach a record $1.6 trillion this fiscal year illustrates the challenges facing President Barack Obama and Congress as they struggle to stimulate the recovery while keeping the budget gap manageable. Deterioration in the government’s balance sheet in coming years raises the risk of higher interest rates. Tonight, U.S Fed Chairman Ben Bernanke will speak. He will continue to speak tomorrow at the Joint Economic Committee where he will lay out his economic outlook.
Later today, there will be a lot of action on both sides of the US Canadian border, as both countries are set to simultaneously announce their trade balances (1330GMT). Last month, Canada reported a 0.8B surplus; however, the Canadian positive economic data was outshone by an unexpected decrease in the US trade deficit – which narrowed to 37.3billion.
This time around, the US expects its trade deficit to widen to 38.4billion, while north of the border, Canada predicts that their trade surplus will remain consistent at 0.8billion. This double event usually causes a lot of volatility in the USD/CAD pair.
A deficit that’s forecast to reach a record $1.6 trillion this fiscal year illustrates the challenges facing President Barack Obama and Congress as they struggle to stimulate the recovery while keeping the budget gap manageable. Deterioration in the government’s balance sheet in coming years raises the risk of higher interest rates. Tonight, U.S Fed Chairman Ben Bernanke will speak. He will continue to speak tomorrow at the Joint Economic Committee where he will lay out his economic outlook.
Later today, there will be a lot of action on both sides of the US Canadian border, as both countries are set to simultaneously announce their trade balances (1330GMT). Last month, Canada reported a 0.8B surplus; however, the Canadian positive economic data was outshone by an unexpected decrease in the US trade deficit – which narrowed to 37.3billion.
This time around, the US expects its trade deficit to widen to 38.4billion, while north of the border, Canada predicts that their trade surplus will remain consistent at 0.8billion. This double event usually causes a lot of volatility in the USD/CAD pair.