UK government borrowing take off as the private sector activity contracts at the fastest speed over 2 years

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The UK government received a double economic strike on Wednesday, as the annual state borrowing occurred almost £ 15 billion than expected, and the private sector activity was made at the fastest pace in two years.

Borrowing figures put pressure on Rachel’s Chancellor to raise taxes in the autumn budget to balance books as PMI data on Wednesday, a private sector health indicator, showed that businesses are fighting.

The deficit between government revenues and expenses amounted to £ 151.9 billion in 12 months before March, Office of national statistics Said exceeding over 10 percent of £ 137.3 billion. Just a month ago Office for budget liabilitythe financial guardian of the government.

It was also 20.7 billion pounds more than in the same 12-month period a year earlier, and the third largest borrowing for the full financial year.

“This causes the chance that if the chancellor wants to follow his financial rules, you will need more tax hikes in the autumn budget,” Gregory Ruth said at Consultancy Capital Economics.

Meanwhile, the S&P Global Flash UK PMI Composite conclusion decreased to a 29-month minimum of 48.2 in April with 51.5 in the previous month, according to new data published on Wednesday.

This was lower than the prognosis of 50.4 economists, and below 50 thresholds, which indicates a reduction.

Chris Williamson, Chief Economist of the S&P Global Market Intelligence, said: “While the last months have been characterized by British enterprises seeking water, widely stagnant with the budget last autumn, businesses report a greater struggle to keep their heads over the water in April.”

Reivz, which increases taxes paid by employers in the budget last fall, has an independent rule that up to 2029-30 costs should be covered daily costs.

The public sector loans for the month of March amounted to £ 16.4 billion, which is slightly higher than £ 16 billion.

But the figures on Wednesday also showed that the current UK budget deficit, which reflects the borrowing to finance the public sector’s daily activities, was £ 74.6 billion, which is 13.9 billion pounds more than the OBR forecast last month.

ONS chief economist Grant Fitzner said the growth in the public sector “largely due to the costs associated with inflation, including higher payments and rates, came, despite” significant “revenue increase.

The UK borrowing costs and deterioration of economic prospects exerted further pressure on the country’s state finances. Last month, OBR warned that, despite the recent reductions in the well -being, the government “budget supply” – or the budget room for the maneuver – remained historically small at £ 9.9 billion.

US President Donald Trump tariffs are also focused on Britain, as well as many other countries, 10 percent across the board and higher levels on steel and cars.

Mel Straid, Chancellor of Shadows, accused Riva of “overcoming financial rules” and increasing the £ 30 billion per year.

“” These eyes are paid by hard -working people through higher taxes, higher prices and raising mortgage rates. ”

Darren Jones, Chief Secretary of the Treasury, said the government “experienced every penny of taxpayers spent on the line for the first time in 17 years to tear the waste.”

The figures come because the Reivz should attend the IMF and the World Bank in Washington.

On Tuesday IMF Cut out growth forecast in 2025 for the UK up to 1.1 percent, which is 1.6 percent compared to a preliminary estimate, a widely economic violation of trade tensions.

Ons notes that the cost of the public sector increased by £ 56.8 billion in 12 months before March compared to the previous financial year, and higher costs for public services, payments and debt.

The interest paid by the Central Government’s debt increased by 2.1 billion to £ 85 billion, largely because the indexes paid by indexes are increasing with the retail price index.

The public sector receipts increased by £ 36 billion, with the growth of the central government’s tax revenues partially offset by the reduction of national insurance premium.

On Wednesday, the UK debt management management said it plans to increase its debt by 2025-26 by £ 5 billion, compared to the fact that it outlined Riva in the spring statement, taking a total requirement of pure financing to 309 billion pounds.

After growing long -term borrowing costs and urged DMO to abandon its long -term debt issuance, he said he would finance the additional short -term treasured accounts and reduced the long -term gilding he plans to sell.

Long-term debt rallied, pushing a 30-year harvest in the UK-which strike Since 1998, the highest since the beginning of this month – decreased by 0.09 percentage points to 5.27 percent.

Additional George Parker Report and John Smith in London