Solid economic growth will help the federal budget deficit shrink this year to its lowest level since President Barack Obama took office, according to congressional estimates released Monday.
The Congressional Budget Office says the deficit will be $468 billion for the budget year that ends in September. That's slightly less than last year's $483 billion deficit.
As a share of the economy, CBO says this year's deficit will be slightly below the historical average of the past 50 years.
In a report released Monday, CBO projects solid economic growth for the next few years. The official scorekeeper of Congress also expects unemployment to drop slightly.
"In CBO's estimation, increases in consumer spending, business investment and residential investment will drive the economic expansion this year and over the next few years," the report said.
CBO also cited wage increases, rising wealth and the recent decline in oil prices.
For future years however, CBO issued a warning: Beyond 2018, deficits will start rising again as more baby boomers retire enroll in Social Security and Medicare. By 2025, annual budget deficits could once again top $1 trillion, unless Congress acts.
Obama inherited an economy in recession when he took office. The deficit topped $1 trillion for each of his first four years in office, including a record $1.4 trillion in 2009.
CBO projects that the economy will grow at an annual rate of 3 percent in both 2015 and 2016. In later years, however, CBO projects slower economic growth as more baby boomers retire and the labor force grows more slowly than it did in the 1980s and 1990s.
CBO projects the unemployment rate will gradually decrease to 5.3 percent in 2017. It is now 5.6 percent.
The budget agency also revised its estimates for government spending on health care under Obama's health care law. Compared to estimates made last April, CBO says the government will spend $101 billion less over the next decade on Medicaid and subsidies to help people by health insurance through state-based exchanges.
CBO projects that the number of people who get health insurance through the exchanges will double in this year, to an average of 12 million people over the course of the year. Last year, the average was 6 million.
Also, the number of residents without health insurance is projected to drop from 42 million last year to 36 million this year.