the nonpartisan congressional budget office hiked its estimate for the us budget deficit by 130 billion for this year now seeing the shortfall at 154 trillion and renewed its warning that the treasury could run out of sufficient cash as soon as early next month the new numbers from the cbo show an even worse fiscal outlook than the agency presented in february and may be seized on by republican negotiators attempting to use the current debtlimit showdown with democrats to slash federal spending the cbo also on friday reiterated that it sees a “significant risk” of a us payments default in the first two weeks of june unless lawmakers raise the federal debt ceiling if the treasury can stave off default until june 15 infusions of revenue could help carry the us at least to the end of july the cbo said president joe biden and house speaker kevin mccarthy are locked in a tense political fight over raising the 314 trillion debt limit with democrats demanding a “clean” increase or suspension as congress did for previous administrations the 130 billion increase in the deficit seen by the cbo for the 2023 fiscal year roughly matches the size of the cuts in discretionary spending next year that mccarthy is seeking in the debtlimit talks mccarthy is also seeking other cuts outside the discretionary budget the 9 increase in the deficit estimate for the year through september is due to changes in the cbo’s model including   factoring in 71 billion in higher spending related to relaxed studentloan repayment programs   some 33 billion in increased spending on deposit insurance accounts   23 billion more in interest costs due to rising interest rates the spending increases were mitigated somewhat by 223 billion in reduced spending for medicare advantage over the decade due to reimbursement rules changes over the coming decade deficits total 20 trillion and federal debt held by the public reaches 467 trillion in 2033 amounting to 119 of gross domestic product the highest in recorded us history the agency also projects that annual deficits will reach 27 trillion in 2033 or 69 of gdp that compares with a 50year average of 36