Little information in first deficit of the UK's new fiscal year

UK's fiscal year ending in March showed the deficit undershooting the revised OBR forecast of £90.2bn made in the March Budget by £2.9bn. In the last few months, the underlying deficit has fallen by roughly £0.5bn compared to a year earlier. Improvement in fiscal deficit is expected to have continued in April so Societe Generale predicts a PSNBex deficit of £8.7bn compared to £9.3bn a year earlier.

There will be little genuine information about the trend in this release. The first month of a new fiscal year is usually volatile as new spending plans come into operation. Moreover, with a new government coming into power after the 7 May general election, there could and probably will be some changes to the fiscal plans later in the year.