UK GDP Growth Above Expectations

2025-08-14 06:12 By Joana Taborda 1 min. read

The British economy grew 0.3% qoq in Q2 2025, slowing from a 0.7% expansion in Q1 but surpassing forecasts of just 0.1%, according to preliminary estimates.

The moderation partly reflects activity being brought forward to February and March ahead of April’s stamp duty changes and the announcement of new US tariffs.

In Q2, growth was fuelled by a 0.4% rise in services, led by computer programming and consultancy (+4.1%).

Construction climbed 1.2%, while production fell 0.3% due to utilities (-6.8%) and mining (-0.3%), partly offset by a 0.3% increase in manufacturing.

On the expenditure side, growth was driven mainly by a 1.2% rise in government consumption, particularly in health (vaccinations) and public administration and defence.

Gross capital formation increased on the back of higher changes in valuables, inventories, and alignment adjustments, but business investment slumped 4%.

Household spending rose a modest 0.1% and exports increased 1.6%, outpacing the 1.4% rise in imports.



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