George Osborne is walking a tightrope. The UK budget shows just how little room to manoeuvre the chancellor of the Exchequer has on his fiscal targets. In 2010, he set out a plan that placated rating firms' concerns, prompting Standard & Poor's to remove its then-negative outlook on the UK's triple-A rating. This year, he couldn't pull off the same trick.

Osborne did have some good news on Wednesday. The Office for Budget Responsibility, the UK's fiscal watchdog, says he is on track to meet his targets. Borrowing is set to come in marginally lower, and growth marginally higher, at 0.8% this year. Net debt is set to peak lower than previously forecast, at 76.3% of GDP in 2014-15, although only thanks to the transfer of Royal Mail pension-fund assets to the public sector - a one-time gain. On a gross basis, debt still peaks above 90% of GDP, very high for a triple-A-rated country.