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UK Economy Contracts by 0.1% in January, Missing Growth Expectations

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Updated Mar 14, 2025, 08:41 AM

The UK economy unexpectedly contracted by 0.1% in January 2025, according to data released by the Office for National Statistics. This decline follows a 0.4% growth in December and falls short of economists' forecasts of a 0.1% increase in gross domestic product. The contraction was primarily driven by a 0.9% decrease in production output, with significant downturns in manufacturing sectors such as metals and pharmaceuticals. Mining, oil, and gas production also experienced notable declines. The services sector, which has been a key driver of recent growth, dipped by 0.2%. The unexpected shrinkage of the economy has intensified pressure on Chancellor Rachel Reeves and the Labour government ahead of the upcoming Spring Budget. Business confidence has reportedly weakened amid concerns over proposed budget measures and the potential impact of policies like the Employment Rights Bill.

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Sources

bbc.co.uk(3)gbnews.com(2)theguardian.com(2)bloomberg.com(2)

Matt Goodwin

@GoodwinMJ

The UK economy tanked from 0.4% to 0.1% at the start of the year. We are going backwards. This is what happens when you cling to a Big State, Big Tax, Big Debt, Big Net Zero, Big Immigration model that is stifling growth and prosperity.