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UK Economy Stalls: Growth Flatlines at Year-End
11 Jan
Summary
- UK GDP growth expected at 0.2% in November, following a 0.1% contraction in October.
- Economy on track for zero growth in the final quarter of 2025.
- Manufacturing and retail sectors show mixed signals, impacting overall economic performance.
The British economy is poised for stagnation as it concluded last year, with official figures anticipated to show very modest growth. November's Gross Domestic Product (GDP) is forecast to have expanded by 0.2 percent, a slight uptick after a 0.1 percent contraction in October. This trajectory suggests the economy is heading towards zero growth for the entire fourth quarter of 2025, a slowdown from a healthier first half.
Factors influencing this economic climate include a recovery in manufacturing, which had been impacted by a cyber attack on Jaguar Land Rover. Retail sales in November, while not as poor as October's, remained weak. Additionally, a five-day doctors' strike may have contributed to the subdued performance, affecting consumer spending and business activity.
Experts anticipate that hotel and restaurant spending will provide some support to November's figures. However, the overall outlook indicates a period of flat growth, aligning with the Bank of England's latest forecast for the fourth quarter. Prime Minister Keir Starmer has identified economic growth as his administration's top priority.
