WASHINGTON: The US White House said the federal budget deficit will fall to $583 billion this year, the smallest deficit of President Barack Obama’s tenure and the first to dip below $600 billion since the Great Recession took hold in 2008.

In its mid-year review of the nation’s finances, the White House predicted that the deficit for the fiscal year that ends in September will be about $66 billion lower than the administration forecast in February.

The improvement is driven primarily by sluggish rates of spending at the Pentagon and other federal agencies, particularly on recovery efforts for Hurricane Sandy.

The administration also expects to spend less this year than previously forecast on health insurance subsidies for low-income families under the Affordable Care Act.

The price of those subsidies is now predicted to be slightly higher, however, over the coming decade.

While the analysis brought good news for the short term, the outlook for the longer term was less rosy: The White House predicts that the nation’s finances will deteriorate markedly over the next decade, with deficits rising by nearly $600 billion compared with previous projections.