LONDON, Jan 23 (Reuters) - Britain posted a smaller-than-expected budget deficit of 7.77 billion pounds ($9.9 billion) in December, the Office for National Statistics said on Tuesday, welcome news for finance minister Jeremy Hunt as he works on possible new tax cuts.
Economists polled by Reuters had expected public sector net borrowing, excluding state-owned banks, of 14 billion pounds, the same as the estimate from the government's budget watchdog.
The ONS said the government's debt interest bill was the lowest for the month of December since 2020, reflecting the fall in inflation.
Borrowing in the first nine months of the financial year totalled 119.1 billion pounds, 11.1 billion pounds higher than in the April-December period a year earlier but almost 5 billion pounds less than the budget watchdog's forecast for the period.
Public sector net debt, excluding state owned banks, stood at 2.69 trillion pounds, equivalent to 97.7% of economic output. ($1 = 0.7846 pounds) (Reporting by Sachin Ravikumar; Editing by William Schomberg)
