Accuracy of Projections

In its June 2024 projections for fiscal year 2025, CBO underestimated revenues by 6 percent and outlays by 2 percent. The agency overestimated the federal budget deficit by 0.7 percent of GDP.

CBO announces what to expect in the coming weeks as the agency begins the new calendar year with a series of reports that offers updated insights into the nation's demographic trends, economic outlook, and budgetary conditions.

In its May 2023 budget projections for fiscal year 2024, CBO underestimated revenues by 1 percent and outlays by 6 percent. CBO’s projection of the federal budget deficit for 2024 was less than the actual amount by 1.1 percent of GDP.

CBO assesses the quality of the baseline projections of deficits and debt that it has made each spring from 1984 to 2023.

In this report, CBO uses various measures to assess the quality of its past projections of federal outlays. The analysis focuses on three fiscal years within each projection period: the budget year, the 6th year, and the 11th year.

The Congressional Budget Act of 1974 requires CBO to produce an annual report on federal spending, revenues, and deficits or surpluses. This document provides answers to questions about how CBO prepares those baseline budget projections.

The average error for CBO’s budget-year revenue projections is 1.2 percent, indicating the agency has tended to slightly overestimate revenues. For the agency’s sixth-year revenue projections, the average error is greater—5.6 percent.