UK Economy Unexpectedly Grows in June

The UK economy expanded 0.4% month-on-month in July 2026, picking up from 0.3% growth in June and defying expectations of stagnation. This marked the strongest expansion since February, as all three main sectors contributed, with services output rising 0.4%, production 0.2% and construction 0.1%. Within services, the largest positive contribution came from administrative and support service activities, which rose 3.7%, driven by rental and leasing (7.9%), services to buildings and landscape (4%) and employment activities (2.5%). Information and communication output also increased 2.4%. These gains were partly offset by a 1% decline in wholesale and retail trade. Meanwhile, production growth was supported by a 0.9% rise in manufacturing, while construction growth came solely from a 0.8% increase in repair and maintenance as new work fell 0.4%. On an annual basis, GDP expanded 1.6%, the strongest growth since February 2025, accelerating from 1.1% in June and beating expectations of 1.2%.

The UK economy grew 0.3% month-on-month in June 2026, compared with zero growth in May and expectations for no change. The economy was helped by the temporary decline in energy costs, along with hot weather and World Cup football. Services output remained the sole driver of overall growth, rising 0.4%, with the largest positive contribution coming from professional, scientific and technical activities (1%), particularly scientific research and development, which rose to its highest level since January 2025, as well as legal activities. Administrative and support service activities (1.8%) and information and communication (0.9%) also contributed positively to GDP growth. This more than offset declines in production (-0.2%) and construction (-0.1%). Yearly, GDP rose 1.1%, slowing slightly from a revised 1.2% increase in May but exceeding forecasts of a 0.8% growth. GDP increased 0.4% in the three months to June, matching expectations, after a revised 0.6% rise in the previous period.

The UK economy expanded by 0.1% month-on-month in May 2026, in line with market expectations and rebounding from a 0.1% contraction in April. Growth was driven solely by a 0.3% increase in services output, with professional, scientific and technical activities providing the largest positive contribution, supported by strength in scientific research and development and advertising services. Administrative and support services and health activities also advanced. These offset a 0.5% decline in production and a 0.8% fall in construction. In the three months to May, GDP grew 0.7%, marking a sixth consecutive three-month expansion, led by services, which rose 0.7%, while construction increased 1.6% and production edged up 0.1%. Compared with a year earlier, the GDP expanded 1.3%, below forecasts of 1.4% but marking the steepest growth since July 2025, and accelerating from a downwardly revised 1.1% increase in April.