21.11.201723:45:00UTC+00UK Government Borrowing Increased in October

The UK government borrowed more than expected in October, following a six month period to September during which public sector borrowing had came in sharply below expectations. The figure comes ahead of the Budget, and the monthly deficit was larger than economists had predicted.

According to the Office for National Statistics, the public sector, excluding state-backed banks, borrowed a net £8 billion in October, which is £0.5 billion higher than the same period in 2016. The figure implies that borrowing is poised to come in below the Office for Budget Responsibility's forecast of £58.3 billion for the financial year as a whole.

The rise in October came after a six-month period during which public sector borrowing dropped to its lowest level in a decade and came in below the short-term outlook predicted by the Office for Budget Responsibility.

In the financial year-to-date, the public sector had to borrow £38.5 billion, £4.1 billion lower than in the same period in 2016. September's borrowing figures, which already came in £0.6 billion below expectations, were revised downwards, from £5.9 billion to £5 billion.

Chancellor Philip Hammond will present the latest Budget on Wednesday. Hammond has to balance calls for more government spending against the prospect of softer future economic growth, which could affect tax revenues.

A deterioration in the long-term outlook and an expected downgrade to productivity growth forecasts is likely to raise projected public borrowing.