The UK economy expanded at its fastest rate in over a year during the first quarter of 2025, as businesses ramped up investment and exports surged ahead of new US trade tariffs.
According to data from the Office for National Statistics (ONS), gross domestic product (GDP) rose by 0.7% between January and March, beating expectations from both the Bank of England and private sector forecasters, who had predicted 0.6%. The figure marks a significant acceleration from the 0.1% growth recorded in the final quarter of 2024.
Year-on-year, the economy is now 1.3% larger, representing the best quarterly performance since early 2024 and the fastest growth among G7 economies during the period.
The gains were led by a 0.7% rise in the services sector, which makes up around 75% of total UK output. Manufacturing and industrial production also contributed, with production output growing by 1.1% over the quarter. Construction remained flat.
The sharp uptick in business activity comes ahead of President Donald Trump’s April 2 tariff imposition on UK goods, which economists believe led to a front-loading of exports. The ONS reported a £2.4 billion rise in exports to the US during the first three months of the year — a clear sign, it said, of “changing trader behaviour ahead of tariff introduction”.
Support authors and subscribe to content
This is premium stuff. Subscribe to read the entire article.
