Britain’s public finances deteriorated further in June as the government borrowed £20.7 billion, official data from the Office for National Statistics showed on Tuesday. The outturn exceeded the median economist forecast of £16.5 billion and the Office for Budget Responsibility’s projection of £17.1 billion, marking the second-highest June deficit since monthly records began in 1993. The overshoot was driven largely by a £16.4 billion debt-interest bill—almost double the level a year earlier—after April’s inflation spike lifted payments on index-linked gilts. Overall central-government spending rose £12.4 billion from June 2024, outpacing a £5.7 billion increase in tax and National Insurance receipts that was boosted by April’s higher employers’ contributions. Borrowing in the first quarter of the fiscal year climbed to £57.8 billion, 15% more than the same period last year and the third-largest April-to-June shortfall on record. While the cumulative figure broadly matches the OBR’s year-to-date forecast, analysts say the profile leaves little margin for slippage if growth stalls or further spending pressures emerge. Chancellor Rachel Reeves told reporters that the U.K. remains “very reliant on the goodwill of strangers” to buy its bonds and warned that “global factors are pushing up the cost of borrowing.” Economists said the latest numbers increase the likelihood of additional tax rises in the Autumn Budget if the government is to meet its pledge to balance day-to-day spending by the end of the decade.