UK economy beats economists’ expectations, growing 0.5% in February
Britain’s economy grew by more than expected in February, official data showed on Thursday, in a broad-based expansion that economists said largely predated the impact of escalating tensions in the Middle East.
The Office for National Statistics said gross domestic product rose by 0.5% in February, beating forecasts of around 0.2% to 0.3% and marking the strongest monthly growth since early 2024.
Growth was driven by services and production, both of which expanded by 0.5%, while construction output rose by around 1%, according to the data. The ONS said the increase reflected widespread gains across the economy, including a recovery in car manufacturing following earlier disruption linked to a cyber incident.
The February rebound followed flat growth in January and suggested the economy entered the year on a firmer footing than many analysts had expected.
However, economists cautioned that the figures were backward-looking and did not capture the effects of the conflict involving Iran that began at the end of February, which has since pushed up global energy prices and heightened uncertainty.
The United Kingdom is seen as particularly exposed to such shocks due to its reliance on imported energy, with analysts warning that higher costs could weigh on growth and keep inflation elevated in the coming months.
Recent forecasts from the International Monetary Fund indicate the UK could face a relatively sharp downgrade to its growth outlook compared with other major economies, reflecting the expected impact of the conflict and tighter financial conditions.
Inflation pressures are also expected to intensify, with markets anticipating a rise in price growth and increasing the likelihood that the Bank of England will keep interest rates higher for longer. The central bank has held its main rate at 3.75% and signalled it will proceed cautiously on any policy changes.
Analysts said the stronger February data was unlikely to materially alter the Bank’s near-term thinking, given the uncertainty surrounding the economic outlook and the risk of further external shocks.
How does media coverage compare?
All headlines highlighted that February growth exceeded expectations, but they diverge in tone and framing along political lines. Left-leaning outlets presented the figure as surprising and fragile against the backdrop of geopolitical uncertainty, while tabloid and more right-leaning reporting leaned focused on immediate positives that reflected their ideologies.
UK economy showed surprise 0.5% growth before Iran war
