Public sector finances.
Debt-to-GDP ratio is the ratio between a country's national debt and its gross domestic product (GDP).
This ratio is used to gauge a country's ability to service its debt.
A high ratio means a country is not producing or earning enough to service its debt.
A low ratio means there is plenty of economic activity to generate the value to meet the commitments.
- Ongoing deficits in the UK
- "The net effect of the coronavirus impact and the policy response is likely to be a sharp (but largely temporary) increase in [UK] government borrowing that will leave public sector net debt permanently higher as a share of GDP...
- Before the impact of the coronavirus became clear, the government was content to run an ongoing deficit that would broadly stabilise the debt-to-GDP ratio over the medium term rather than reduce it – a judgement that it will no doubt re-visit in the wake of the current crisis."
- The UK OBR’s coronavirus analysis, 14 April 2020