UK Government Borrowing Comes in Higher Than Expected

Government borrowing was higher than expected at £12.6bn in November as the growth in income tax receipts slowed on the previous month.

Official figures showed that income tax receipts increased by only 1.1%, after several years of consistent 3%-plus growth, to prevent the UK’s budget deficit falling at the pace forecast by City analysts.

Economists polled by Reuters had expected borrowing of only £12.1bn.

But the November borrowing figure was lower than last year’s £13.2bn and put the Treasury on course to meet the Office for Budget Responsibility’s revised target for borrowing by the end of the year.

The stories you need to read, in one handy email
Read more
The OBR said in March it expected the budget deficit to fall to £55bn, or more than 20% on the previous year, but said in the autumn statement the fall would be more like 10% to £68bn to take account of the Brexit vote shock, which slowed economic growth and reduced the government’s income.

Howard Archer, an economist at IHS Global Insight, said the modest improvement on last year was “reassuring for the chancellor”.

He said: “This is welcome for Hammond as it would have been somewhat embarrassing if the first set of public finance figures after the November autumn statement had immediately put question marks over his new fiscal targets,” he said.

The Office for National Statistics said that excluding the publicly owned banks, figures for the financial year to date – April to November – showed the deficit fell by £7.7bn to £59.5bn, compared with the same eight months in 2015.

via The Guardian

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.