Government borrowing exceeded forecasts as soaring inflation pushes up debt service costs.
Government borrowing hit £4.9bn in July – well above the £0.2bn expected by the fiscal watchdog. This brought the total for 2022-23 so far to £55bn, £3bn more than forecast.
While tax revenues were higher, the deficit was driven by debt service charges, which jumped 81% from a year ago.
Indeed, a quarter of public debt is tied to the retail price index, which hit its highest level since 1981 last month as runaway inflation shows no sign of abating.
The figures will add pressure on Conservative leadership candidates Liz Truss and Rishi Sunak, who have both promised to cut taxes despite soaring government borrowing.
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What happened overnight
Asian equities were left in limbo this morning as the US dollar rode all the way as the clouds of recession gathered over Europe and highlighted the country’s relative outperformance. American economy.
Added concerns over the health of China’s economy saw MSCI’s broadest index of Asia-Pacific stocks outside of Japan slipping 0.3%, only to fall 1.1% on the week.
Chinese blue chips were flat, while South Korea lost 0.5pc. The Japanese Nikkei fared better with a gain of 0.3 pc due in part to a further drop in the yen.
- Company : Apax Global Alpha (interim)
- Economy: GfK consumer confidence, public finances, retail sales (UK), inflation (Japan), producer prices (Germany)