The numbers: The federal government ran a budget deficit of $32.6 billion in January, compared with a surplus of $9 billion in the same month one year earlier, the Treasury Department said Wednesday. This is in-line with the $32 billion deficit estimated by the Congressional Budget Office last week.

What happened: Spending for January was $404.9 billion while the government brought in $372.3 billion.

For the fiscal year to date, the deficit totaled $389.2 billion, up from $310.3 billion in same period one year ago.

Big picture: The CBO projects$1 trillion annual budget deficits each year for the next decade. Fed Chairman Jerome Powell has urged lawmakers to put the deficit on a more sustainable path so that the government can increase spending to combat the next recession.

Market reaction:Despite the outlook for the deficit, the yield on 10-year Treasury note TMUBMUSD10Y, -1.24%  has fallen 32 basis points since the start of the year.

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