Key economic data in the countdown to the Budget

Thursday’s better-than-expected GDP figures are the first in a sequence of data over the next two weeks that will highlight the state of the economy before the Budget.

Here the Press Association runs through the key announcements in the run-up to Chancellor John Healey’s speech on October 28:

– Tuesday October 20: Unemployment and wages

Unemployment levels have stabilised in recent months, with the rate plateauing at 4.9%, according to estimates by the Office for National Statistics (ONS).

The rate reached 5.2% in early 2026, close to the 5.3% seen during the Covid-19 pandemic, before falling back slightly.

Data on the UK jobs market has been unreliable for several years, due to issues with the size of the survey used by the ONS to produce its calculations.

But trends in the figures suggest the unemployment rate is at a higher level than when Labour came to power in July 2024, while the number of vacancies has fallen, as has annual growth in earnings.

Besides providing updates on all these measures, the new figures will include fresh estimates of the level of economic inactivity.

This is the number of people who are of working age and not in employment but who are not currently looking for work, for reasons such as illness, study or personal choice.

– Wednesday October 21: Inflation

The annual rate of consumer inflation eased to 2.6% in June, before accelerating to 2.9% in July and 3.1% in August, according to the ONS.

The new figures are likely to show another jump in September, meaning the rate will have increased three months in a row.

Rising fuel costs and energy prices are the main factors driving the current rise in inflation, reflecting the impact of the ongoing conflicts in the Middle East and Ukraine.

Inflation is still well below levels seen during the cost-of-living crisis in 2022-23, when the rate peaked at 11.1%.

But another rise will mean the rate has moved further away from the Bank of England’s target of 2%, besides posing a headache for a Government keen to provide “breathing space” for people struggling to make ends meet.

September’s inflation data is also particularly important to the Treasury as it is typically used to decide the level of increases for a number of taxes and other costs.

Consumer price inflation for the month can determine rises in income tax and business rates, while retail price inflation is often used to calculate changes in alcohol and tobacco duties.

The Treasury has not yet confirmed whether these inflation measures will be used to decide the size of increases for the financial year beginning next April.

– Wednesday October 21: Government borrowing and debt

These figures are likely to show annual government borrowing remains lower than at this point last year, but higher than the level forecast by the Office for Budget Responsibility.

The OBR will publish a new forecast on Budget day that could revise upwards the amount of likely borrowing in 2026/27, which in turn would mean Chancellor John Healey has less so-called financial “headroom” to deal with economic risks and threats.

Meanwhile, the level of public sector debt – the amount owed to the private sector in the UK and overseas – has so far remained just below £3 trillion.

Hitting this symbolic figure just days before the Budget would be a grim milestone for the Government.

The Chancellor may prefer to focus on the level of debt as a share of the economy, which was the equivalent of 93.8% of GDP at the end of August – lower than 12 months earlier.

– Friday October 23: Retail sales

The most recent set of retail sales figures showed a return to growth in August, driven by a boost from online shopping and department stores.

This followed a drop in the volume of sales in July.

The new figures, which will be for September, may be less positive due to the challenges now facing shoppers from rising fuel and energy costs, as well as grocery price increases.

Retail sales are also a reflection of consumer confidence and the Government will hope this latest data – the last key economic announcement before the Budget – shows positive momentum before winter.