Tuesday, May 24, 2011

High Borrowing in April

UK borrowing hit hit £10bn in April, higher than last year, when borrowing for the month was £7.3bn. (UK debt)

However, in the 12 months to this April, public sector net borrowing was £139.4 billion in the year for 2010/11 down from £156bn in the previous year.

The level of borrowing is higher than many expected as the government received a bonus of £3.5bn from the bank windfall tax.

It is another disappointing statistic for the UK economy, with CPI inflation recently increasing to 4.5%. Growth remains sluggish. The rest of the year will probably see an improvement in public finances as more government spending cuts take effect. Yet, these spending cuts will hamper the fragile recovery and impact on cyclical tax revenues.

1 comment:

Lawrence Low said...

Since policymakers knew that an economy cannot cut itself out of recession, but why they still insist for it? Getting hold to the Growth and Stability Pact more important?