Britain posts borrowing surplus in January

British state borrowing accounts showed the biggest surplus for five years in January, boosted by interest from the Bank of England's bond-buying policy and increased tax revenues, official data showed on Thursday. The public sector net borrowing measure registered a surplus - or net debt repayment - of 11.4 billion pounds ($17.3 billion, 13.2 billion euros) last month, the Office for National Statistics (ONS) said in a statement. That was the biggest surplus since January 2008 and compared with a surplus of 6.4 billion pounds in January 2012. The data excludes the temporary effects of financial interventions such as bank bailouts. Market expectations had been for a smaller surplus of 6 billion pounds, according to analysts polled by Dow Jones Newswires. The public finances were boosted as 3.8 billion pounds of interest from the Bank of England's quantitative easing (QE) stimulus programme of asset purchases was included in the calculations for the first time. The ONS noted that not all of the funds transferred from the British central bank's QE programme were allowed to be counted towards reducing the deficit. In November, the government said it would receive a total of 35 billion pounds in interest earned on state debt that was purchased under the BoE's 375-billion-pound QE stimulus programme. And in December, the government's Office for Budget Responsibility fiscal watchdog had estimated that QE transfers would cut state borrowing by 11.3 billion pounds in the current 2012/2013 financial year. But the ONS said on Thursday that a total of 6.4 billion pounds would be used to reduce the deficit this year, and that 12 billion pounds would be applied in 2013/2014. Under QE, the central bank creates new money which is used to purchase assets such as government and corporate bonds with the aim of boosting economic activity. January's public finance figures were meanwhile also bolstered by tax receipts, which tend to jump higher during the first month of the year.