Overview
- Official ONS data show GDP was unchanged in July after a 0.4% rise in June, with three‑month growth easing to 0.2%.
- Production weakened broadly, with manufacturing down about 1.3%, offsetting modest increases in services (+0.1%) and construction (+0.2%).
- The print broadly matched market expectations and follows a stronger first half of 2025 when the UK led the G7, with forecasters now anticipating a cooler second half.
- The stagnation adds fiscal strain ahead of the Autumn Budget, with investors and businesses watching for possible OBR forecast downgrades and tax measures.
- Inflation near 3.8% complicates the Bank of England’s scope for further rate cuts as policymakers head into upcoming decisions.