MNI 5 THINGS: UK Jan Surplus Gives Chancellor Added Impetus

By Jai Lakhani

     LONDON (MNI) - The following are the key points from the UK public sector

finances data published Thursday by the Office for National Statistics.

     --Whilst a January surplus was anticipated, the largest on record was not.

January's surplus was stg14.895bn, which in turn sent year to date borrowing

below the OBR's forecast of stg25.5bn after it went noticeably above target in

recent months.

     --These figures undoubtedly support Chancellor Philip Hammond's rhetoric

for fiscal easing in 2019/2020. In recent months, this could have come under

scrutiny due to the fact YTD borrowing had overshot the OBR's target.

     --Previous MNI analysis noted that surpluses in January and February over

the last two years have averaged stg8.4bn. Should this hold true for 2018/2019,

net borrowing of stg6.3bn in March would see the UK hit the OBR target.

     --Tax receipts were noticeably strong across the board, but record highs

from self assessment taxes and capital gains taxes stole the show. Receipts from

these sub-sectors were stg1.9bn and stg1.2bn respectively.

     --RPI falling to a two year low in January played its part in keeping the

UK government's interest costs low. Debt interest costs were down by stg0.7bn

when compared to January 2018.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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