22 Oct 2013
UK government borrowing falls while BoE deputy governor sees signs of recovery gaining traction
FXstreet.com (London) - The UK continued with its positive data today, with September public sector net borrowing (PSNB) ex-financial interventions coming in under expectations, at GBP11.1bn against consensus expectations of GBP11.3bn.
The borrowing numbers also represent a GBP1bn cut on September 2012, though some of the boost may be attributed to some top rate earners delaying income into the current tax year to take advantage of the cut in the income tax rate from 50 percent down to 45.
Additionally, despite public political rhetoric about spending cuts, departmental spending continues to rise.
UK GDP figures due on Friday should show positive momentum, pointing towards further improvements as the UK attempts to chip away at its GBP1.23 trillion debt.
The figures coincided with Bank of England deputy governor Charlie Bean’s comments that "There are at last signs that a recovery may be gaining traction."
In prepared remarks to the Society of Business Economists Annual Conference in which he defended the BoE’s forward guidance, Bean said that the UK’s economy was going through accelerated and sustained growth. "Businesses have got the message that the MPC will only begin to tighten policy once the recovery is entrenched". Bean added that there is some evidence that households pushed back expectations of interest rate rises after forward guidance was announced.
GBP/USD continues to trade flat, with subdued activity ahead of today’s US non-farm payroll numbers at USD1.6135.
The borrowing numbers also represent a GBP1bn cut on September 2012, though some of the boost may be attributed to some top rate earners delaying income into the current tax year to take advantage of the cut in the income tax rate from 50 percent down to 45.
Additionally, despite public political rhetoric about spending cuts, departmental spending continues to rise.
UK GDP figures due on Friday should show positive momentum, pointing towards further improvements as the UK attempts to chip away at its GBP1.23 trillion debt.
The figures coincided with Bank of England deputy governor Charlie Bean’s comments that "There are at last signs that a recovery may be gaining traction."
In prepared remarks to the Society of Business Economists Annual Conference in which he defended the BoE’s forward guidance, Bean said that the UK’s economy was going through accelerated and sustained growth. "Businesses have got the message that the MPC will only begin to tighten policy once the recovery is entrenched". Bean added that there is some evidence that households pushed back expectations of interest rate rises after forward guidance was announced.
GBP/USD continues to trade flat, with subdued activity ahead of today’s US non-farm payroll numbers at USD1.6135.