UK public borrowing in surplus

This morning’s UK public sector borrowing figures showed their biggest surplus for 4 years, prompting speculation that the government may beat its own borrowing forecasts for the year.

The UK’s total public sector net debt, excluding financial sector interventions, fell back to £988.7bn, having breached £1tn in December. The surprise improvement is good for the Pound, although with the GDP revision due out on Friday, markets will still be cautious.

Meanwhile the EU have formally agreed the Greek bailout package, which will mean Greece can refinance its debts in March and stay in the Eurozone. Euro exchange rates had been tipped to fall on the news, but there is still scepticism about the longevity of the solution, so the sovereign debt crisis has probably got some distance to run yet.