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UK growth revised down to 0.2 per cent in second quarter

Gross domestic product growth for the April–June period was revised down to 0.2 per cent from an earlier estimate of 0.3 per cent, the Office for National Statistics said in a statement.

UK business district
The Canary Wharf business district including global financial institutions in London. (Photo: Getty Images)
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THE UK economy grew less than first estimated in the second quarter, revised official data released on Monday showed, adding pressure on the Labour government.

Gross domestic product growth for the April–June period was revised down to 0.2 per cent from an earlier estimate of 0.3 per cent, the Office for National Statistics (ONS) said in a statement.


Growth in the third quarter was unchanged at 0.1 per cent, the ONS said, extending a slowdown from the 0.7 per cent expansion recorded in the first quarter of the year.

“The economy is still pretty weak and is heading into 2026 with very little momentum,” said Alex Kerr, UK economist at Capital Economics.

Keir Starmer has faced difficulty in lifting Britain’s economy since his Labour Party came to power in July 2024.

Chancellor Rachel Reeves raised taxes on businesses in her first budget last year, a move that has been blamed for weak growth and rising unemployment.

She followed this in her November budget with further tax increases aimed at reducing government debt, this time affecting workers.

The Bank of England last week cut its main interest rate to 3.75 per cent after inflation eased faster than expected and as the economy weakened.

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UK household savings drop

The saving ratio dropped by 0.7 percentage points to 9.5 per cent, its lowest level in over a year

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UK household savings drop to lowest level in over a year as tax burden bites

Highlights

  • Household saving ratio drops to 9.5 per cent, lowest since mid-2024, as tax increases outpace income growth.
  • GDP growth confirmed at 0.1 per cent for July-September period, down from 0.2 per cent in previous quarter.
  • Britain's economic momentum fades after strong start to 2025, with zero growth expected in final quarter.

British households saved significantly less between July and September this year as higher taxes squeezed disposable incomes, forcing families to dip into savings to maintain spending levels, according to official data from the Office for National Statistics.

The saving ratio dropped by 0.7 percentage points to 9.5 per cent, its lowest level in over a year, as real household disposable incomes took a substantial hit from tax increases which outweighed income growth and inflation pressures.

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