GBP Weakens Ahead of UK Budget Amid Rising Fiscal Concerns

The British Pound (GBP) has weakened against the US Dollar (USD), slipping to near 1.3200 during the early European session on Friday.

This downward trend in the GBP/USD pair comes amid growing domestic fiscal concerns ahead of the upcoming UK budget, with the Office for National Statistics reporting that public sector borrowing hit £18.27 billion in August, exceeding market forecasts.

The cumulative deficit from April to August reached £77.3 billion, surpassing the Office for Budget Responsibility's projection by £8.1 billion. This has put pressure on UK Chancellor John Healey to raise taxes or cut spending at next month's budget.