Last week, the UK's delicate economic situation was underscored by challenging employment and inflation data. This morning, the fiscal picture deepened those concerns: Government borrowing for June reached £20.7 billion. Driven by increasing debt service payments, this represents an almost £7 billion increase from last year and marks the second-highest June borrowing on record, surpassed only by 2020. The combination of higher unemployment, persistent inflation, and a widening deficit underscores the policy challenge facing the UK as it embarks on the multi-month process of budget formulation. Yet, prolonged deliberation and uncertainty surrounding the budget's contents risk exacerbating current economic headwinds, potentially leading to even more subdued growth. #economy #UK #markets