ONS data showed GDP for the three months to June rose 0.4% QoQ, down from 0.6%
in Q1 and in line with economists' forecasts. Services drove the expansion; May
was flat and June rose 0.3% month-on-month (economists had forecast -0.1%).
Analysts say the UK largely weathered the initial months of the Iran war and
consumer spending supported activity in Q2, but the Bank of England and
economists expect growth to weaken as the conflict’s full effects emerge.
Momentum in 1H 2026 is expected to ease into a muted H2 as a 13% July increase
in the energy price cap squeezes households and policy uncertainty has risen
after Burnham became the UK’s seventh prime minister in over a decade.
