# Federal surplus or deficit / GDP | PIER20 benchmarks

How large is the federal budget balance relative to the economy?

The federal surplus or deficit to GDP ratio expresses the annual US federal budget balance as a share of gross domestic product. A negative reading is a deficit: the government spent more than it raised. A positive reading is a surplus. Scaling by GDP normalizes the figure for the size of the economy, so deficits across decades become directly comparable.

As of **2025**, the latest reading is **-5.77 % of GDP**. That is up 0.4 pp over the past year and below its long-run median of -2.58 % of GDP.

## Summary statistics (full history)

| Series | First | Latest | Min | Max |
|---|---|---|---|---|
| Federal surplus or deficit / GDP | 0.70 | -5.77 | -26.86 | 4.30 |

## Last 24 readings

| Date | Federal surplus or deficit / GDP |
|---|---|
| 2002 | -1.44 |
| 2003 | -3.30 |
| 2004 | -3.38 |
| 2005 | -2.44 |
| 2006 | -1.80 |
| 2007 | -1.11 |
| 2008 | -3.10 |
| 2009 | -9.76 |
| 2010 | -8.60 |
| 2011 | -8.33 |
| 2012 | -6.62 |
| 2013 | -4.03 |
| 2014 | -2.75 |
| 2015 | -2.42 |
| 2016 | -3.11 |
| 2017 | -3.39 |
| 2018 | -3.77 |
| 2019 | -4.57 |
| 2020 | -14.48 |
| 2021 | -11.69 |
| 2022 | -5.27 |
| 2023 | -6.07 |
| 2024 | -6.20 |
| 2025 | -5.77 |

## How to read this benchmark

**What a high or low reading means.** A larger deficit (more negative) means the government is borrowing more to fund its spending, which can stimulate the economy in the short run but adds to the federal debt stock and competes with private borrowing for savings. A surplus is rare in the modern era. The late-1990s surpluses came alongside strong growth and asset-price gains, the typical surplus regime.

**Why GDP as the denominator.** A deficit of $100 billion meant something very different in 1960 than in 2025 because the economy was a fraction of the size. Scaling by GDP makes the deficit comparable across decades and against other countries: a 5% deficit is a 5% deficit whether the economy is $1 trillion or $30 trillion.

**Limitations.** The series is annual and published by the Office of Management and Budget, so each point is one fiscal year and is revised when the budget is finalised. The ratio measures the flow of borrowing in a single year, not the accumulated stock of debt (tracked separately as federal debt to GDP). Off-budget items and accounting choices can shift the figure from year to year. Treat it as context for fiscal regimes, not investment advice.

**Historical extremes.** The largest deficit on record is roughly minus 26.9% of GDP in 1943, at the peak of Second World War mobilisation, more than four times the size of any modern deficit. The largest surplus is roughly plus 4.3% in 1948, during the post-war demobilisation boom. The late-1990s ran four consecutive surpluses peaking near plus 2.3%, the only sustained surplus period in the modern era. The 2020 pandemic deficit reached roughly minus 15% before reverting.

## How this benchmark is used

**Fiscal stimulus sizing.** Policymakers and macro strategists use the deficit-to-GDP ratio as the standard measure of fiscal stimulus size, both historically and cross-country. The 2009 ARRA stimulus, the 2020 CARES Act and the 2021 ARP are each sized in deficit-to-GDP terms so they can be compared against the 1943 wartime mobilisation and against each other.

**Sovereign credit and Treasury supply.** Bond market participants track the deficit ratio to gauge net new Treasury supply: a larger deficit means more issuance to absorb, which interacts with the Federal Reserve's balance-sheet policy to set long-end yields. The ratio is a standard input to term-premium and supply-demand models for US Treasuries.

**Fiscal-monetary policy mix.** The deficit ratio is one half of the fiscal-monetary mix that cross-asset strategists use to set regime: loose fiscal plus tight monetary tends to support the currency and hurt bonds, while loose fiscal plus loose monetary tends to support risk assets and commodities. The ratio is paired with the Fed funds rate and the Fed balance sheet to label the regime.

## Frequently asked questions

**What is the current federal surplus or deficit / GDP?**

As of 2025, the latest reading is -5.77 % of GDP. That is up 0.4 pp over the past year and below its long-run median of -2.58 % of GDP.

**How often is this benchmark updated?**

This benchmark is built on annual data. The page is refreshed when the source publishes new observations; the freshness block below the chart shows the exact data-through date and when PIER20 last fetched the file.

**What data sources does this chart use?**

The chart is built from Federal surplus or deficit / GDP, sourced from Federal Reserve Economic Data (FRED).

**What is the largest deficit and surplus the US has recorded?**

Across the annual series, which begins in 1929, the largest deficit is roughly minus 26.9% of GDP in 1943 at the peak of Second World War mobilisation, more than four times any modern deficit. The largest surplus is roughly plus 4.3% in 1948 during the post-war boom. The late-1990s ran four consecutive surpluses, the only sustained surplus stretch in the modern era.

**When did the US last run a budget surplus?**

The federal government ran surpluses for four consecutive fiscal years from 1998 through 2001, peaking near plus 2.3% of GDP in 2000. That is the only sustained surplus period in the modern era; every fiscal year since 2002 has been a deficit.

**How is the deficit different from the debt?**

The deficit is the flow of borrowing in a single fiscal year: how much more the government spent than it raised. The debt is the accumulated stock of all past borrowing. A deficit adds to the debt each year; a surplus pays it down. PIER20 tracks the debt separately in the gold vs US federal debt benchmark.

**Why was the 1943 deficit so much larger than modern ones?**

Second World War mobilisation required the federal government to spend roughly 40% of GDP on the military, financed by enormous borrowing. The 1943 deficit of roughly minus 27% of GDP was funded by war bonds, price controls and rationing. Modern deficits, even the 2020 pandemic spike near minus 15%, are far smaller relative to the wartime mobilisation peak.

## Methodology

- Formula: FYFSGDA188S as published (% of GDP)
- Frequency: Annual
- Sources: Federal surplus or deficit / GDP (FYFSGDA188S) https://fred.stlouisfed.org/series/FYFSGDA188S. Data via Federal Reserve Economic Data (FRED).
- Data through: 2025
- Last refreshed: 11 Aug 2026

## Related benchmarks

- [Corporate debt / GDP](https://pier20.com/benchmarks/corporate-debt-to-gdp)
- [Nominal GDP vs real GDP](https://pier20.com/benchmarks/nominal-vs-real-gdp)
- [Wages vs consumer prices](https://pier20.com/benchmarks/wages-vs-cpi)
- [House prices vs median household income](https://pier20.com/benchmarks/house-prices-vs-income)

Full interactive chart: https://pier20.com/benchmarks/federal-deficit-to-gdp
Disclaimer: research software output, not investment advice.