Overview

• The UK economy expanded by 0.7% in the first quarter of 2025, exceeding the forecasted 0.6% growth and marking the fastest quarterly growth in a year.
• Services and production sectors drove growth, with services rising 0.7% and production output increasing by 1.1% over the quarter.
• March GDP growth slowed to 0.2%, down from February’s 0.5%, reflecting growing caution among businesses and consumers.
• Economists expect Q1 growth to be temporary, citing April's national insurance hike and US tariffs as factors likely to weigh on Q2 performance.
• The Bank of England has upgraded its 2025 growth forecast to 1%, but analysts caution that underlying economic momentum remains fragile.