The latest figures from the Office for National Statistics (ONS) show public sector borrowing hit £11.6 billion in August, the fourth highest August figure since records began thirty years ago. Government borrowing so far this year at £90.5 billion is a whopping 40% higher than it was in August 2022…

£5.6 billion of last month’s figure was spent on debt interest alone. That’s almost half of the total. Although that would only fund the NHS for 11 days…

Good news, though: In the financial year-to-August 2023, public borrowing sat at £69.6 billion, £11.4 billion less than forecast by the geniuses at the Office for Budget Responsibility. The OBR forecasts overshot again thanks to £21 billion extra in government coffers, largely from stealth tax receipts. How about those tax cuts, Jeremy…

The Office for National Statistics reports the Consumer Prices Index rose by 6.7% in August, down from 6.8% in July. Hunt is capitalising on the economist-defying decrease and said his plan is “the only path to sustainably higher growth.” The OECD predicted yesterday that UK inflation will fall to 2.9% next year. Buoying news for Rishi’s team…

The BoE is predicted to tighten up again on Thursday with a 0.25% hike in interest rates. Free market economist Julian Jessop says the Bank “should have hit the pause button on interest rates several meetings ago to assess the full impact of the tight squeeze that is already in place. Even if the MPC does decide to hike one more time this week, they should signal that rates are then on hold for a long period.” All eyes on Threadneedle Street tomorrow…

The Organisation for Economic Cooperation Development (OECD) forecasts UK inflation to fall back to 2.9% next year… although this year’s figure is set to average 7.2%, the worst in the G7. At least Rishi is on target to meet one of his pledges by Christmas…

The OECD also expects the UK to hit average growth of around 0.3% this year, up to 0.8% in 2024. Better than Germany… although still small beer. Jeremy Hunt is instead pointing to the IMF figures to cheer everyone up:

“Today the OECD have set out a challenging global picture, but it is good news that they expect UK inflation to drop below 3 per cent next year. It is only by halving inflation that we can deliver higher growth and living standards. We were among the fastest in the G7 to recover from the pandemic, and the IMF have said we will grow faster than Germany, France, and Italy in the long term.”

In the meantime, the Bank of England could hike interest rates to 5.5% on Thursday…

Pressure is mounting on the Bank of England to raise interest rates by another 0.25% next week, after new figures from the Office for National Statistics showed average earnings in the three months to July were up by 8.5% on the year. Annual inflation slowed to 6.8% in July. Wages have now pipped inflation for first time in nearly two years…

At the same time, there are signs the labour market is cooling. Unemployment rose again for the third consecutive month to 4.3% while vacancies continued to fall. Jeremy Hunt is keeping a brave face this morning:

“It’s heartening to see the number of employees on payroll is still close to record highs and that our unemployment rate remains below many of our international peers. Wage growth remains high, partly reflecting one-off payments to public sector workers, but for real wages to grow sustainably we must stick to our plan to halve inflation.”

Governor Andrew Bailey has suggested the Bank is nearing the end of its now-monthly interest rate hikes, although yesterday his Monetary Policy Committee colleague Catherine Mann urged officials to “err on the side of tightening further“. All eyes on Threadneedle Street next week…

Chris Pincher has written to Jeremy Hunt to formally resign as the MP for Tamworth. It follows the Independent Expert Panel throwing out Pincher’s suspension appeal, which meant he was already set for an 8-week exclusion that would have guaranteed a recall petition anyway. He told GB News’s Christopher Hope:

“I have said already that I will not stand at the next General Election. However, following the Independent Expert Panel’s decision I wanted to talk to my office team and family. I do not want my constituents to be put to further uncertainty, and so in consequence I have made arrangements to resign and leave the Commons. Tamworth is a wonderful place and it has been an honour to represent its people. I shall make no further comment at this time.”

Tamworth is, in theory, a Conservative safe seat. UK Polling Report still projects a Tory win, although Labour will fight tooth-and-nail…