The federal budget deficit now stands at $17.3 billion, eight months into the fiscal year, the Finance Department reported Friday.
That compares with $26 billion for the same period last year.
In November, the excess of spending over revenues grew by $1.9 billion. That was less than half the increase in the $4.5 billion shortfall a year earlier.
The latest accounting shows the deficit is shrinking at a faster rate than expected.
In the recent fall economic update, Finance Minister Jim Flaherty projected Ottawa would be in the red by $32.3 billion. With four months left, the government is on pace to come in with a deficit under $30 billion.
In a commentary, TD Economics projected the deficit to come in at a range between $27 billion and 28 billion, with the deficit-to-GDP ratio for the year close to 1.7 per cent, a "significant" improvement from the 3.6 per cent figure at the peak of the recession beginning in 2009.
In November, Ottawa said its revenues were down slightly, but expenses fell sharply by $2.5 billion, partly due to the windup of stimulus projects introduced during the downturn in 2008 and 2009.
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