UK government borrowing overshoots expectations

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According to the official figures, the UK government’s review is overwhelming expectations in February, according to official figures, which confirms the pressure on Chancellor Rachel Reeves while preparing for her spring statement next week.

The National Statistics Office said that the shortage of government and spending income was 10.7 billion pounds last month. This is compared to expectations of 6.5 billion pounds from the budget responsibility office, the government’s financial agency, and a similar projection in a Reuters poll for the economists.

Reeves is preparing to show the spring, which will put additional pressure on government spending because it tries to maintain public financial affairs on the right track. The advisor pledged, according to its financial rules, the current budget, which excludes investment, by 2029-30.

But the weak state of the economy and public finance means that the expectations from OBR are expected to indicate that more adherence to spending is required. The government has announced plans to provide social welfare of 5 billion pounds annually, and is expected to reveal new pressure on the departments on Wednesday.

“The reduction of costs can only go further, and like a sudden batch of UK growth this summer, we believe that walking long distances appear inevitable in the fall,” said James Smith, an Energy economist in Inge. “Britain’s general financial affairs are increasingly great margins.”

Alex Care in Capital Economics said that the transcendence of February in borrowing was driven through the most softening receipts and high spending, leaving the government on the right track to overcome its current budget deficit in the current fiscal year.

He added that the numbers confirm “how difficult the options [Reeves] The faces over the next few years will be. “

In the fiscal year to February, the deficit was 132.2 billion pounds, or about 14 billion pounds more than the same point in the previous fiscal year. This was much higher than 111.8 billion pounds by OBR in October 2024.

“The growth is weaker than the costs of OBR expectations and borrowing higher,” said Mark Daving, chief investment official for fixed income at RBC Bluebay Asset Management.

In October, OBR expected GDP growth by 2 percent for this year, but the weak turns means that this will be sharply reduced next week. In February, England expects 0.75 percent to grow only in 2025.

UK government bonds were weakened in morning trading on Friday, which led to poor performance in other large markets and the payment of the return for 10 years, an increase of 0.03 degrees Celsius to 4.68 percent.

The numbers indicate that there are up to 20 billion pounds in the additional central government financing needs over the current official expectations, which may mean more debt sales in the fiscal year 2025-26.

She added that the rise in Friday in the revenues of a doctrine indicates that investors “are concerned that all these gaps will be covered by all these gaps with more version.”

The net government debt ratio to GDP at the end of February was temporarily estimated by 95.5 percent, according to the ONS version, which is 0.1 degrees Celsius higher than last year.

Reeves came out of its first budget in October with the head hall against the rule of its current deficit of 9.9 billion pounds, but it was eliminated through high government borrowing costs and flat growth.

The doctrine investors have warned that the consultant would need to be rebuilt that main space to show that it maintains the public finances of Britain in order.

Reeves insisted that the announcement of next week will not constitute a major financial event, as officials say there will be no tax height.

But pressure, including the need to increase defense spending and repair public services, indicates that they can be forced to conduct more revenue measures of this parliament.

Darren Jones, chief of secretary at the Treasury, said: “We are re -concentrating the public sector in our duties, and for the first time in 17 years, we pass every penny from the taxpayer money line to ensure that it helps us secure the future of Britain through the change plan,” said Darren Jones, head of the Secretary of the Treasury.

“At the core of this urgent task, the proper public finances fall, based on our non -negotiable financial rules.”