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British public deficit drops in February

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(Globalpost/GlobalPost)

British state borrowing sank in February on the back of proceeds from a 4G mobile telephone network auction, official data showed Thursday, boosting the government a day after its annual budget highlighted the struggle to cut a huge deficit.

Public sector net borrowing -- the government's preferred measure of the budget deficit -- fell to £2.8 billion ($4.23 billion, 3.29 billion euros) last month, the Office for National Statistics (ONS) said in a statement.

That was the lowest recorded February deficit since 2008, and compared with borrowing of £11.8 billion in January 2012.

Market expectations had been for a deficit of £8.9 billion in February, according to analysts polled by Dow Jones Newswires. The borrowing data excludes the temporary effects of financial interventions such as bank bailouts.

Borrowing was pushed lower last month after the government received £2.3 billion from the 4G airwaves auction, and thanks also to £2.7 billion of interest payments from the Bank of England's programme aimed at stimulating Britain's weak economy.

The news will boost finance minister George Osborne, a day after he revealed that the coalition government needed to borrow almost £60 million more than originally forecast by 2017-2018.

In his latest austerity budget, Osborne also slashed Britain's 2013 economic growth forecast to 0.6 percent on the back of the chronic debt crisis in key trading partner the eurozone. The previous growth estimate had been 1.2 percent.

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http://www.globalpost.com/dispatch/news/afp/130321/british-public-deficit-drops-february