Financial News: UK GDP Growth Rebounds In February

UK GDP Growth Rebounds In February

04/11/2025 - 05:21:00 (RTTNews)

(RTTNews) - The UK economy expanded at a solid pace in February with increases in all main sectors but recent trade tariffs announced by the US administration cast shadow over recovery prospects.

Real gross domestic product grew 0.5 percent from the previous month following a nil growth in January, data from the Office for National Statistics revealed Friday. GDP was expected to climb 0.1 percent.

On a yearly basis, real GDP advanced 1.4 percent compared to economists' forecast of 0.9 percent.

On the production-side of GDP, services output logged a monthly growth of 0.3 percent after rising 0.1 percent in January. At the same time, industrial production rebounded 1.5 percent, following a revised 0.5 percent drop a month ago.

Within industrial output, manufacturing grew 2.2 percent in February, reversing a 1.0 percent drop in January.

Construction output moved up 0.4 percent, in contrast to the 0.3 percent fall in January.

In three months to February, GDP advanced 0.6 percent from the three months to November, mainly because of growth of 0.6 percent in the services sector. The surprisingly strong growth of 0.5 percent in February and the upward revision to January GDP came as a pleasant surprise, Capital Economics' economist Ruth Gregory said.

But higher US tariffs, heightened uncertainty and April's rise in business taxes suggests February's resilience won't last, the economist noted.

ING economist James Smith said, "February's surprisingly upbeat GDP data is a reminder that despite all the tariff gloom, activity should remain supported in the near term by government spending and real-wage growth."

Another data from the ONS showed that the visible trade gap widened to GBP 20.8 billion in February from GBP 18.2 billion in January. At the same time, the total trade balance posted a deficit of GBP 1.9 billion compared to a surplus of GBP 0.3 billion in January.

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