The UK government borrowed £16bn in June, slightly below the £16.3bn forecast by the Office for Budget Responsibility (OBR), according to official data.This marks a £7.9bn reduction compared to June 2025, with the Office for National Statistics (ONS) noting a 'relatively steady' labour market.However, total debt remains near £3 trillion, close to the annual value of the UK economy.

While the borrowing figure is better than expected, economists highlight the fragility of public finances, with limited scope for additional borrowing.The OBR's forecast for the current financial year shows borrowing at £57.6bn, £2.7bn above predictions.

New Prime Minister Andy Burnham and Chancellor John Healey have pledged to adhere to fiscal rules, though Burnham has indicated flexibility for policy changes.Interest payments on debt fell to £11.8bn, the lowest since 2020, but remain the fourth highest on record.Unemployment stayed at 4.

9%, with private sector wage growth dipping below 3% for the first time since 2020, raising concerns about living costs and potential interest rate stability.