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UK economy grows modestly
GDP rose 0.3% in the April-June quarter, beating forecasts but signaling persistent headwinds.
Official figures show the second-quarter economy expanded, beating expectations despite slower growth and ongoing headwinds.
UK economy grows modestly beating forecasts
UK GDP grew by 0.3% in the April to June quarter, better than the 0.1% forecast but slower than the 0.7% rise in the previous quarter. The services sector led the gains, with construction also contributing to the uptick. The Office for National Statistics revised April’s data, turning a 0.3% drop into a 0.1% contraction. Business investment fell by about 4%, while household spending dipped, underscoring continued headwinds. In June, growth benefited from solid service activity and favorable weather for construction; Goldman Sachs lifted its forecast for UK growth for the year to 1.4%.
Key Takeaways
"The figures were "positive" for an economy that "has felt stuck for too long""
Statement by Chancellor Rachel Reeves on the data
"Economic vandalism by this budget"
Conservative shadow chancellor Mel Stride on fiscal policy
"Snails would scoff at the pace that our economy is growing"
Liberal Democrat Daisy Cooper on growth pace
"The weak global economy will remain a drag on UK GDP growth for a while yet"
Ruth Gregory of Capital Economics on the outlook
The quarter shows a cautious recovery built on services and a weather-driven construction bounce. Yet investment weakness remains a overhanging risk, and the short-term glow could fade if policy clarity and global demand do not improve. The numbers provide room for guarded optimism, but reforms and credible fiscal plans are needed to turn a fragile uptick into sustained momentum. The political backdrop adds another layer of uncertainty that can influence business decisions and consumer confidence in the months ahead.
Highlights
- Snails would scoff at the pace that our economy is growing
- Economic vandalism by this budget
- The weak global economy will remain a drag on UK GDP growth for a while yet
- Those factors were always going to be a drag
Budget and political sensitivity risk
The data come as budget debates and tax policy loom, potentially influencing business investment and consumer spending amid political contention.
Policy choices in the autumn will test whether today’s gains are durable.
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