As of early 2025, the United Kingdom’s economy was doing unexpectedly well. In September, the Office for National Statistics (ONS) released new figures that showed just how resilient this sector has been. The ONS announced a meager 0.1% growth for that arbitrary third quarter, running from July through September. This figure was an improvement on what analysts had forecast, predicting a growth of 0.2%. That is on the heels of a robust 0.3% advance in the last quarter. It also begs to be asked, given further negative trends that are advancing across the economy as it slows ever more.
The ONS provides the fastest GDP estimates of any major economy. They only publish these numbers about 40 days after each quarter ends. With GDP figures published monthly, the ONS enable close monitoring of the economic performance, providing swift and regular in-depth updates. GDP contracted by 0.1% in September. It’s a troubling sign that despite moderate quarterly growth, many industries continue to struggle.
Even with indications of a growth slowdown, the UK’s formidable economic resilience in early-2025 has inspired hopefulness. Meanwhile the International Monetary Fund (IMF) has raised its forecast for the UK economy. It now expects an annual growth rate at least double the 1% last expected by the Office for Budget Responsibility (OBR) last March. This optimism is an indication of a more positive view of the UK’s economic fundamentals against a global backdrop of uncertainty.
The UK economy has been on a quite remarkable deceleration since the economy had a very strong first quarter of the year. Some analysts said the growth in Q2 was far rosier than expected. Deep infrastructure challenges — some of which are self-imposed — threaten to derail their hard-won success. Quarterly figures, which represent three-month periods, are always more meaningful than monthly data. For this reason, they offer a more complete picture of economic movement and growth.
GDP can be measured through three primary approaches: Output, Expenditure, and Income. The Output method measures the value added of all the goods and services produced by all sectors, capturing the economic activity across the entire economy. The Expenditure approach considered all of an economy’s spending, but the Income method compared all income made from production.
Beyond just ranking economic performance, the ONS has added well-being metrics next to GDP beginning in 2010. This dual focus underscores the importance of not only assessing financial growth but considering the broader impact on societal welfare.
Those recent GDP numbers are a bit more encouraging. There are worries that two quarters of negative GDP growth would be a recession. As companies and policy leaders steer their way through a still-volatile economic environment, experts are still keeping a wary eye on these trends.