With criticism pressing in from all sides and the continual dark lows of the financial crisis to contend with, there aren’t many people who’d be keen to trade places with George Osborne.
Today however, the much berated Chancellor of the Exchequer has some reason to feel justified in sticking to his policy guns.
According to the Office for National Statistics the shortfall excluding government support for banks dropped between April and August compared with the same period last year. 2011’s figure of 13.5 billion Pounds narrowed to 12.8 billion Pounds, the lowest September figure recorded since 2008.
Economists participating in a Bloomberg survey anticipated no change. The report also detailed a 3.7 per cent rise in Central-government spending and tax revenue.
The contraction in the budget deficit was due to strengthening local government finances as well as improvement in the financial circumstances of publicly controlled companies.
Although economists still expect borrowing for 2012/2013 to overshoot if ‘the trend in the first six months of the fiscal year continues’ it may be by less than previously anticipated. Today’s ONS release showed a downward revision in borrowing from April to August of 6.7 billion Pounds.
The Office for Budget Responsibility, whose previous economic predictions were proven to be overly optimistic, is in the process of revising economic and monetary forecasts. The fiscal watchdog will present their findings to Osborne in time for his Parliamentary statement in the first week of December.
The Pound experienced negligible fluctuations against the US Dollar following the announcement.
As of 11:55 am
The Pound to Euro exchange rate is currently trading at 1.2302
The Pound to US Dollar exchange rate is currently trading at 1.6055
The Pound to Australian Dollar exchange rate is currently trading at 1.5492
The Euro to US Dollar exchange rate is currently trading at 1.3050
The Euro to Pound exchange rate is currently trading at 0.8128
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