Economics
Sunak’s Budget Boost Comes With Warning on U.K. Debt Costs
- Budget deficit in 2021-22 first half 29% below OBR forecast
- Debt costs running 50% higher on year due to inflation spike
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U.K. government borrowing was significantly lower than forecast in the first half of the fiscal year but a surge in debt costs sent a warning to Chancellor of the Exchequer Rishi Sunak ahead of his budget next week.
The budget deficit totaled 108.1 billion pounds ($149 billion) between April and September, the Office for National Statistics said Thursday. That’s almost 30% below the 151.6 billion pounds predicted by the Office for Budget Responsibility in March, despite inflation driving up interest payments on government debt. The deficit in September alone stood at 21.8 billion pounds, a slightly lower figure than economists expected.