U.S. August Deficit Hits $345B, Net Interest Becomes 3rd Largest Outlay

The US government reported a $345 billion deficit in August, with $344 billion in receipts and $689 billion in spending.
Key expenditures: Medicare ($141 billion), Social Security ($134 billion), and net interest ($93 billion).
Net interest is now the third-largest expense, indicating pressure from rising borrowing costs on federal finances.
The Federal Reserve might cut rates by 25 basis points in September, though past trends show potential for increased yields, as seen in September 2024.
Recent inflation data suggests that rate cuts could exacerbate price pressures and increase debt servicing costs, thus complicating fiscal management.
Gold has reached near-record highs at just below $3,670 per ounce, up nearly 40% year-to-date.
Bitcoin has surpassed $115,000, reflecting investor interest in alternative assets amid concerns over debt sustainability.