🔗 Share this article Britain's Economic Growth Expands as GDP Rises by 0.1% in August Ahead of Important Budget Government data indicate the UK economy grew by 0.1% in August, offering a lift to government officials before next month's crucial budget announcement. A surge in manufacturing output, coupled with a strong showing from the health sector, helped the overall expansion. Yet, statistical data revised July's earlier stated flat growth to a 0.1% decline, limiting the overall growth rise over the three-month span to August to 0.3%. Economists Expect Continued but Sluggish Expansion Financial experts suggest the UK's economic prospects is likely to continue improving, albeit at a sluggish pace, as firms and households await the outcome of the chancellor's budget on 26 November. Current global trade disputes, including tariff disputes, are expected to contribute to uncertainty in global economic conditions. Budget Measures and Sector Results The finance minister is considering raising funds through a series of tax increases in the fall budget to address a budget gap estimated between £20 billion and £30 billion. Manufacturing output turned around a 1.1% decline in July to grow by 0.7% in August, supported by a strong increase in pharmaceutical production. At the same time, the services industry, which accounts for about 75% of economic activity, remained unchanged for the second month in a row. Construction activity declined by 0.3% in August from the previous month, with a decline in maintenance work canceling out a 0.5% rise from fresh construction work. Forecasts and Outlook The GDP figures aligned with earlier forecasts from financial economists, who expected a resumption to slight expansion of 0.1% in August, mainly due to a rebound in the industrial industry. The result puts the UK on track to meet IMF forecasts that it will be the second-fastest expanding economy in the Group of Seven in 2025. Price rises are forecast to begin easing before the end of the year, and the central bank is expected to make additional borrowing cost cuts in 2026, easing pressure on household finances. "Recent figures indicate there will be only modest growth in the third quarter after a difficult summer for businesses." Regaining momentum depends on restoring business confidence and reducing uncertainty, which the administration can support by allocating a larger fiscal buffer in the upcoming budget. Business groups reported that many companies faced weak orders and increased business costs. Many firms are opting to hold back on recruitment and spending until there is more clarity on the government outlook. A Treasury representative commented: "There has been the quickest growth in the G7 since the start of the year, but for too many people our economy feels stuck." "Working day in, day out without getting ahead." "Government officials is determined to turn this around by helping businesses in every town and main street grow, funding infrastructure and cutting red tape to get Britain building."
Government data indicate the UK economy grew by 0.1% in August, offering a lift to government officials before next month's crucial budget announcement. A surge in manufacturing output, coupled with a strong showing from the health sector, helped the overall expansion. Yet, statistical data revised July's earlier stated flat growth to a 0.1% decline, limiting the overall growth rise over the three-month span to August to 0.3%. Economists Expect Continued but Sluggish Expansion Financial experts suggest the UK's economic prospects is likely to continue improving, albeit at a sluggish pace, as firms and households await the outcome of the chancellor's budget on 26 November. Current global trade disputes, including tariff disputes, are expected to contribute to uncertainty in global economic conditions. Budget Measures and Sector Results The finance minister is considering raising funds through a series of tax increases in the fall budget to address a budget gap estimated between £20 billion and £30 billion. Manufacturing output turned around a 1.1% decline in July to grow by 0.7% in August, supported by a strong increase in pharmaceutical production. At the same time, the services industry, which accounts for about 75% of economic activity, remained unchanged for the second month in a row. Construction activity declined by 0.3% in August from the previous month, with a decline in maintenance work canceling out a 0.5% rise from fresh construction work. Forecasts and Outlook The GDP figures aligned with earlier forecasts from financial economists, who expected a resumption to slight expansion of 0.1% in August, mainly due to a rebound in the industrial industry. The result puts the UK on track to meet IMF forecasts that it will be the second-fastest expanding economy in the Group of Seven in 2025. Price rises are forecast to begin easing before the end of the year, and the central bank is expected to make additional borrowing cost cuts in 2026, easing pressure on household finances. "Recent figures indicate there will be only modest growth in the third quarter after a difficult summer for businesses." Regaining momentum depends on restoring business confidence and reducing uncertainty, which the administration can support by allocating a larger fiscal buffer in the upcoming budget. Business groups reported that many companies faced weak orders and increased business costs. Many firms are opting to hold back on recruitment and spending until there is more clarity on the government outlook. A Treasury representative commented: "There has been the quickest growth in the G7 since the start of the year, but for too many people our economy feels stuck." "Working day in, day out without getting ahead." "Government officials is determined to turn this around by helping businesses in every town and main street grow, funding infrastructure and cutting red tape to get Britain building."