Ahead Of The Bell: Federal Budget

WASHINGTON (AP) — The federal deficit is expected to hit $150 billion for the first month in the new budget year, headed toward another $1 trillion-plus tide of red ink. Economists worry such deficits could push up interest rates, adding a further drag on the fragile economic recovery.

Economists surveyed by Thomson Reuters expect the October deficit totaled $150 billion. That would compare with a September deficit of $46.6 billion and an imbalance of $155.5 billion in the same month last year. The year-ago total was pushed higher by $33 billion in spending for the Troubled Asset Relief Program, the rescue effort for the banking system that launched in October 2008.

The Treasury Department is scheduled to release the new figure at 2 p.m. EST Thursday.

The deficit for the 2009 budget year, which ended on Sept. 30, set an all-time record in dollar terms of $1.42 trillion. That was $958 billion above the 2008 deficit, which had been the previous record holder.

In relation to the overall economy, the 2009 deficit was 9.9 percent of the gross domestic product. That was the highest level since the World War II-era deficit hit 21.5 percent of GDP in 1945.