UK budget deficit is clearly improving compared to the previous fiscal year. In the four months to July, spending was flat compared to the same period a year earlier whereas revenues were up 4.4%.
As always, there are caveats about the quality of the data at this stage of the fiscal year but there is undeniably a genuine improvement taking place.
"The improvement will have continued in August, albeit at a slightly slower pace. The PSNBex should move from £-1.3bn in July (always a surplus month because it is a key tax-paying period) to £9.2bn in August, a £1.2bn reduction on the deficit a year earlier", says Societe Generale.
