UK government borrowed £151.9bn in year to March; investors cheered by hopes of US-China trade deal
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Government borrowing in the UK rose more than expected last month, which means the government borrowed nearly £15bn more than forecast over the year than in the previous fiscal year, underlining the challenges the chancellor Rachel Reeves faces.
Debt interest payments reached £4.3bn in March, the highest March figure since monthly records began 27 years ago. This reflects the fiscal challenge the chancellor faces. Higher debt servicing costs as a share of total revenues will leave the public finances more exposed to future economic shocks.
Rachel Reeves continues to hold the fiscal line, but the next six months will be critical—and she needs some clear wins. While her spring statement restored the £9.9bn headroom, that cushion remains precarious. In the worst-case scenario outlined by the government’s independent forecaster, Trump’s new tariffs could alone shave 1% off UK GDP—enough to wipe out the headroom entirely. The rising cost of government borrowing and growing global uncertainty are compounding the pressure for Reeves to put tax rises on the table during the autumn budget.
9am BST: Eurozone HCOB PMI surveys flash for April
9.30am BST: S&P Global PMIs flash for April
10am BST: Eurozone trade for February
2.45pm BST:: US S&P Global PMIs flash for April
5.30pm BST: Bank of England governor Andrew Bailey speaks
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