UK Public Finances Falls Much More Than Expected in December

© Reuters. UK public sector net borrowing drops to £0.98 billion vs. £4.20 billion forecast

Investing.com - UK’s public finances fell much more than expected in December, official data showed on Tuesday.

In a report, the Office for National Statistics said that UK public sector net borrowing decreased to a seasonally adjusted £0.98 billion in December, from £6.65 billion in the preceding month whose figure was revised down from £8.12 billion.

Analysts had expected the net borrowing to drop to just £4.20 billion.

The ONS highlighted that public sector net borrowing (excluding public sector banks) decreased by £6.6 billion to £50.0 billion in the current financial year-to-date (April 2017 to December 2017), compared with the same period in 2016; this is the lowest year-to-date net borrowing since 2007.

The Office for Budget Responsibility (OBR) forecasts that public sector net borrowing (excluding public sector banks) will be £49.9 billion during the financial year ending March 2018, an increase of £3.9 billion on the outturn net borrowing in the financial year ending March 2017.

The report also showed that the UK public sector net cash requirement rose to £25.13 billion, from £13.152 billion, revised higher from the initial £12.933 billion

For the current financial year-to-date (April 2017 to December 2017), the ONS indicated that the central government net cash requirement by £31.1 billion to £49.4 billion, compared with the same period in 2016; this is the lowest year-to-date central government net cash requirement since 2007.

After the report, GBP/USD was trading at 1.3949 compared to 1.3951 prior to the release, while EUR/GBP was unchanged at 0.8770.