U.K. POSTS RECORD BUDGET DEFICIT

Britain posted a record budget deficit in April as the government unleashed an unprecedented package to prevent the collapse of the virus-stricken economy.

The figures reflect the cost of interventions announced by Chancellor Rishi Sunak, including paying the wages of 8 million furloughed workers, a surge in welfare claims and the hit to tax revenue as the economy plunged into recession. The price may yet go higher the longer the lockdown restrictions last.

While the government’s efforts have protected jobs, many are still struggling. Authorities said Friday banks should extend mortgage holidays for homeowners facing hardship by a further three months.

The devastating impact of the virus was also on display in retail sales figures, which dropped by almost a fifth in April. Luxury goods maker Burberry announced it was unable to give guidance for next year as half of its stores are currently shuttered.

The deficit of 62.1 billion pounds ($76 billion) -- the most since modern records began in 1993 -- was as much as in the whole of the previous fiscal year and almost three times the previous peak. Even during the financial crisis, monthly borrowing was never more than 22 billion pounds.
 
 
 
 
 
Source: Bloomberg