UK economy surprises again yet slowdown incoming
Thursday 13 August 2026 7:09 amJohn Healey will face pressure to give the UK economy a much-needed boost. The UK economy grew 0. 4 per cent between April and June, official data has revealed, although prospects. . .
Thursday 13 August 2026 7:09 amJohn Healey will face pressure to give the UK economy a much-needed boost. The UK economy grew 0. 4 per cent between April and June, official data has revealed, although prospects are set to dim over the rest of the year. The Office for National Statistics revealed that the quarterly reading came alongside a surprise growth figure of 0. 3 per cent in June, topping analyst’s expectations. Figures for May were revised down from 0. 1 per cent growth to no growth. City economists polled by Bloomberg hadpredictedthat growth in the second quarter would be 0. 4 per cent while data for June would show a decline in total product value of 0. 1 per cent. The services sector lifted the UK economy in the three-month period, growing by 0. 5 per cent. Manufacturing activity was flat with no change from the first quarter while the construction sector struggled to build momentum with an expansion of 0. 3 per cent. “Growth slowed in the second quarter of the year, following a strong start to 2026, but remained relatively robust,” Liz McKeown, director of economic statistics at the ONS, said. “Within services, computer programming and advertising continued to perform strongly, as they have done throughout the year, while wholesale was a notable area of weakness. ”Growth in the second quarter of the year is slower than activity recorded in the first three months of the year when the UK’s official data body said GDP increased by 0. 6 per cent. Healey warned about UK economyThe slowdown in output and activity may put the Prime Minister, Andy Burnham, and Chancellor, John Healey, on edge ahead of a difficult Budget. The pair were warned that the UK economy’s future largely depended on President Trump and Iran’s actions across the Middle East and the re-opening of the Strait of Hormuz. According toBloomberg, the top ministers were warned by the Treasury that the UK economy would grow by just 0. 3 per cent if the strait remained blocked for the rest of the year. The Bank of England has also said it would raise interest rates if the strait remains blocked for the rest of the year. Independent forecasters have spelled out similar bleak scenarios for the UK economy. Economists at EY warned that the UK economy could slide into a recession in the scenario where oil and gas fail to leave or pass through the Gulf region, accounting for around a fifth of global supplies. Recent data has shown that government spending has been a large contributor to growth. Healey will come under pressure from industry chiefsto deliver a confidence-boosting Budget against a gloomy backdrop for the UK economy. Devolution is set to be one of the main policies at the Budget, with the Chancellor previously backing regional-led investment bodies to drive growth. But economists at Capital Economics have warned that a smaller fiscal headroom and a number of spending commitments on energy policy support and defence could force him to raise about £25bn in taxes.