Federal Budget Deficit Up in March From Year Prior

The monthly U.S. budget deficit widened to $198.16 billion in March from $188.15 billion in the same month a year earlier, partly because some benefit payments normally made in April were shifted to March, the Treasury Department said on Wednesday.

The monthly U.S. budget deficit was the highest on record for the month of March, although the first few months of the fiscal year are often higher than the remainder of the year by historical standards, Treasury said. Economists surveyed by Reuters had forecast a $196 billion gap.

About $30 billion of benefit payments were accelerated to into March because April 1 fell on a Sunday, which effectively reduced government outlays in March.

The Treasury Department also noted two changes to subsidy estimates for the government bailout program, the so-called Troubled Asset Relief Program, and an education initiative also impacted the March deficit by a total of $20 billion.

During the first six months of fiscal 2012, which began Oct. 1, the cumulative deficit narrowed to $779.0 billion from $829.4 billion in the comparable first six months of fiscal 2011.

The government's spending in March this year was $369.4 billion, down from $339.0 billion in March 2011.

(Reporting by Margaret Chadbourn; Editing by James Dalgleish)