The US Congressional Budget Office (CBO) has projected that the federal budget deficit will exceed $1.85 trillion in 2026, suggesting that the economic policies implemented during President Donald Trump’s administration are exacerbating the country's fiscal situation. This forecast indicates that by 2026, the deficit will represent approximately 5.8% of the nation’s Gross Domestic Product (GDP), a level that is very similar to the projected deficit of $1.775 trillion for the previous fiscal year, 2025.

The report highlights a concerning trend, indicating that the average deficit-to-GDP ratio is expected to rise to 6.1% over the coming decade, with projections suggesting it could escalate to 6.7% by the fiscal year 2036. This trajectory significantly surpasses the Treasury Secretary Scott Pisonet’s goal of reducing the deficit to around 3% of the economy. The ongoing large and persistent deficit poses a fundamental challenge, particularly in light of expected low unemployment rates, remaining below 5% throughout the ten-year budget horizon.

CBO Director Philip Swagel emphasized the unusual nature of such a persistent high deficit historically, especially given favorable labor market conditions. The implications of these findings suggest troubling times ahead for both fiscal policy and economic stability as political leaders navigate through an increasing deficit while managing public expectations and fiscal responsibility.