FTSE 100 Live: Stocks Slide as UK Borrowing Hits £20.2 bn in April

By: Swarnalata

Published on: May 23, 2025

European equities fell on Thursday as the FTSE 100 underperformed amid mounting concerns over the UK’s rising debt and subdued oil markets. Traders grappled with data from the Office for National Statistics showing that government borrowing jumped to £20.2 billion in April—£1 billion more than a year earlier and well above the £17.9 billion expected by economists. The upsurge has pushed public sector net debt (excluding banks) to 95.5% of GDP, levels not seen since the early 1960s.

Oil markets added to the downbeat mood, with crude trading at its weakest since 2021. The lingering effect of President Trump’s trade war has stoked fears of a global growth slowdown, threatening fuel demand. “Oil prices have dropped back as concerns about the US debt pile added another layer of wariness about the outlook for the global economy and energy demand,” said Susannah Streeter, Head of Money and Markets at Hargreaves Lansdown.

Sterling held near $1.342 against the dollar despite the darker fiscal backdrop. Investors noted weak demand at a recent US Treasury auction and the passage of a sizeable tax-and-spend package through Congress, fuelling broader market jitters about America’s debt trajectory and potential inflationary pressures.

Market analysts are also watching OPEC+ closely; plans for another production increase could keep oil oversupplied. Meanwhile, with borrowing figures disappointing despite recent national insurance cuts that boosted revenues by nearly £2 billion, “there is still much more to do,” according to Danni Hewson, Head of Financial Analysis at AJ Bell. In Washington, legislators prepared to vote later today on what President Trump has dubbed his “big, beautiful bill,” underscoring how intertwined US policy and global market sentiment remain.