Strong economic growth has already shrank the deficit federally. Very good news. The deficit for 2009-2010 is 20% smaller than forecast. It is still a massive $40 billion dollars, but it is a good sign that it is already shrinking. We need bigger spending cuts to shrink it faster.
The surprising economic recovery last four months will allow the federal government to run a deficit lower than expected when the fiscal year ended March 31, The Press has learned.
According to some economists, the deficit could be 5 billion less than forecast by Finance Minister Jim Flaherty's latest budget tabled on March 4. And in 2010-2011, Ottawa would record a deficit of 40 billion or 10 billion less than expected.
In his budget, the great financier of the country expected a deficit of 54 billion in 2009-2010. But the economic results very encouraging early months of the year tend to show that the shortfall will be lower.
Already, strategists are rubbing their hands. "Everything indicates that the deficit will be lower than what we originally expected. But it is too early to advance on a figure, "said a source at The Press reliable conservative.