Ketuo Macro: UK October public lending data highlights government fiscal challenges

On November 21st, Golden Ten Data reported that Alex Kell, an analyst at Capital Economics, said that UK public borrowing data for October highlighted the fiscal challenges facing the government, despite a significant increase in spending and taxes announced in the recent budget. Public borrowing, excluding banks, reached £17.4 billion, higher than market Consensus expectations and higher than £15.8 billion in October 2023. In a report, Kell said this means that if Chancellor Rishi Sunak really wants to further increase daily spending, it is likely to require higher taxes. In addition, he also said that if the pump in UK government bond yields since the budget was announced continues, borrowing may be higher in the years ahead than the forecast made in October.