U.S. deficit falls to $680 billion

NEW YORK (CNNMoney) -- The federal government's latest annual deficit is the smallest it's been since 2008, according to Treasury Department data released Wednesday.

 

At $680 billion, the fiscal 2013 deficit is 51% less than it was in 2009, when it hit a record high nominally of $1.4 trillion.

 

As a percent of the economy, it's also considerably smaller than it's been in the past five years, coming in at 4.1% of gross domestic product. By contrast, the annual deficit in 2009 topped 10% of GDP. And last year it was 6.8%.

 

Overall, Treasury said higher receipts accounted for 79% of the decline in the deficit from last year.

 

Several factors have contributed to the strong improvement in the nation's fiscal picture. They include an improving economy and a mix of fiscal restraint -- primarily, the expiration of stimulus measures, the imposition of across-the-board budget cuts known as the sequester, and tax increases on high-income households during the 2013 fiscal year, which ended September 30.

 

Another boon was the fact Fannie Mae and Freddie Mac paid back a large part of the $187 billion federal bailout the mortgage giants received, starting in 2008, to help them weather the housing crisis.