WASHINGTON - The federal budget deficit for the just-ended 2012 fiscal year shrank by $207 billion from the prior year, but still marked its fourth straight year above $1 trillion, Congress' budget referee estimated on Friday.

The deficit equaled about 7 percent of US economic output, down from 8.7 percent in 2011, 9 percent in 2010 and 10.1 percent in 2009, but it was still greater than in any other year since 1947, the non-partisan Congressional Budget Office said.

Economists generally consider any deficit that exceeds 3 percent of US gross domestic product to be unsustainable in the long term.

CBO said a $75 billion surplus September surplus helped to hold the full-year fiscal 2012 deficit to $1.09 trillion, compared with a $1.297 trillion deficit in fiscal 2012.

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