UK Economy's Crucial Health Check Ahead of Budget
This morning brings the final comprehensive health check on the UK economy, delivering crucial data just days before the government's upcoming budget announcement. Three key indicators will provide a clear snapshot of the nation's financial standing, covering public borrowing, consumer spending, and household energy costs.
Public Finances Under Scrutiny
The latest public finance figures are expected to reveal that the UK government borrowed approximately £15 billion during October to cover the significant shortfall between tax receipts and public spending. Economists will meticulously analyse this data to determine whether the government has drifted further off course compared to the forecasts established back in March. These numbers carry substantial weight as they directly influence fiscal decisions in the forthcoming budget.
Retail Sales Show Consumer Caution
Simultaneously, new retail sales data will indicate whether British consumers were affected by pre-budget caution. The City anticipates that retail sales remained flat month-on-month for October, though they showed a 1.5% increase compared to the same period last year. This stagnation suggests households may be tightening their belts amid economic uncertainty.
Energy Price Cap Offers Minor Respite
In a flurry of early morning announcements, energy regulator Ofgem is set to confirm the latest price cap for Great Britain. Households may receive some relief from relentlessly rising costs, with the cap predicted to drop by around 1% from January due to lower wholesale gas prices. According to forecaster Cornwall Insight, this adjustment would lower the average annual dual-fuel bill for a typical household to £1,733, representing a £22 reduction.
Today's Economic Agenda
7am GMT: UK public finances for October released
7am GMT: UK retail sales for October published
7am GMT: UK energy price cap for January-March 2026 set by Ofgem
8am GMT: Eurozone flash PMI economic data
9:30am GMT: UK flash PMI economic data
3.40pm GMT: Bank of England chief economist Huw Pill appears as panellist in Zurich discussing 'the future of the world's leading currencies'
