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The improvement reflected government revenues that have been rising at a faster pace than spending over the past two months.
Prices for U.S. consumers jumped 6.8 percent in November compared with a year earlier as surging costs for food, energy, housing and other items left Americans enduring their highest annual inflation rate since 1982.
U.S. companies had been particularly impacted by a rise in COVID cases in many Southeast Asian countries where much of the production of semiconductors for autos and other products takes place.
The Biden administration said Friday that the 2021 deficit, for the budget year that ended Sept. 30 was $360 billion lower than 2020 as a recovering economy boosted revenues, helping to offset government spending from pandemic relief efforts.
The Federal Reserve reports that the economy faced a number of headwinds at the start of this month, ranging from supply-chain disruptions and labor shortages to uncertainty about the delta variant of COVID.
The jump in inflation this year reflects higher prices for food and energy and a number of other items from furniture to autos as the pandemic has snarled supply chains and demand has outstripped supply.
The Fed survey, released Wednesday, said the slowdown was largely attributable to a pullback in dining out, travel and tourism in most parts of the country, reflecting concerns about the spread of the delta variant.
Treasury Secretary Janet Yellen is warning Congress that she will run out of maneuvering room to prevent the U.S. from broaching the government's borrowing limit in October.
Federal Reserve Chairman Jerome Powell said Tuesday that the U.S. economy has been permanently changed by the COVID pandemic and it is important that the central bank adapt to those changes.
Over the past 12 months, prices at the wholesale level are up a record 7.8 percent, surpassing the old record of a 7.3 percent gain set for the 12 months ending in June.
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