UK economy posts 0.3% Q2 gain as services offset production

The UK economy grew by 0.3% in the second quarter, slowing from 0.7% in the first three months of the year, as the services sector helped offset weakness in production. The upturn in June lifted quarterly growth modestly, with the month posting a 0.4% expansion, even as the quarter as a whole faced a softer pace than analysts had hoped. The latest figures point to a cautious recovery that is fragile and highly dependent on activity in services, construction, and the timing of policy-driven shifts earlier in the year.

Within the breakdown, services led the quarter’s growth, expanding around 0.4%, driven by a mix of subsectors including computer programming, health and vehicle leasing. Construction also contributed to the overall improvement, while production contracted slightly, offsetting the gains elsewhere. An updated data set for April—initially showing contraction—also helped lift the quarterly picture, underscoring how revisions can alter the official narrative. The month of June itself was stronger, suggesting that the economy rebounded after a weaker spring.

Officials and analysts have pointed to several factors shaping the quarterly profile. Activity in April and May was...