WASHINGTON — The Biden administration is forecasting that this year’s budget deficit will be $555 billion lower than it estimated back in May, helped by an economy that is rebounding more quickly than had been expected.

But even with the improvement, the administration said Friday that it is forecasting a deficit of $3.12 trillion for the budget year that ends Sept. 30. That would be the second largest deficit in history, exceeded slightly by last year’s $3.13 billion deficit.

And for the next decade, the administration never sees the deficit falling below $1 trillion.

These estimates were contained in the administration’s Mid-Session Review of the budget.

The deficit totals have worsened over the past two years as the government approved trillions of dollars in support for individuals and businesses caught in an economy reeling from the coronavirus pandemic.

The administration’s Mid-Session Review said much of the improvement in the deficit forecast for this year stemmed from a strong economic rebound, reflecting the impact of President Joe Biden’s economic policies.

The review upgraded the administration’s economic forecasts to show an economy expanding this year by 7.1%, when measured from the fourth quarter of last year. That is up from the administration’s previous projection of growth this year of 5.2%.