Congressional Budget Office predicts $1.3 trillion deficit in 2011

The Congressional Budget Office is now predicting a federal deficit of $1.3 trillion for 2011, according to its latest mid-term outlook, marking the third-largest shortfall in the last 65 years.

The gross domestic product is expected to increase by 2.3 percent this year and 2.7 percent for 2012. The national unemployment rate, according to CBO data, should remain above 8 percent until 2014.

The CBO also expects the unemployment rate to drop from 9.1 percent in the second quarter of 2011 to 8.5 percent by the end of next year.

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