Data published by the Office for National Statistics (ONS) showed that the GDP decreased by 0.1% in January, partially offsetting the December increase (+0.4%) and recording the first drop in three months. Economists expected GDP growth of 0.1%. Meanwhile, over the three-month period (through January), the GDP increased by 0.2% compared with the three months to October 2024. Services grew by 0.4% over this three-month period, while production fell by 0.9% and construction grew by 0.4%.
On an annual basis, GDP grew by 1.0% in January after an increase of 1.5% in December. Consensus estimates suggested an increase of 1.2%. Overall, the GDP release will be the last data print before the U.K. Treasury’s “Spring Statement” on March 26, when Chancellor Rachel Reeves presents an update on her plans for the British economy.
The ONS said that services output is estimated to have grown by 0.1% mom in January, after growth of 0.4% in December. Of the 14 subsectors, output increased in six, with seven subsectors seeing output decline and one showing no growth in January. The largest positive contribution in the services sector came from the administrative and support services subsector where output rose by 1.9% mom, following growth of 1.1% in December. Five out of the six industries in this subsector experienced growth in January, with the largest contributions coming from increases in rental and leasing activities (up 3.0%) and services to buildings and landscape activities (up 4.9%). Output in consumer-facing services increased by 0.1%, following growth of 0.4% in December. Retail trade, except of motor vehicles and motorcycles was the largest contributor to the increase at the industry level, with output growing by 1.7%. The largest partially offsetting contributions within consumer-facing services in January came from food and beverage services (down 2.1%) and accommodation (down 3.4%).
Meanwhile, industrial production fell by 0.9% after rising 0.5% in December. Economists had expected a decrease of 0.1%. Manufacturing production declined by 1.1%, offsetting the December increase (+0.7%). Consensus estimates suggested unchanged value.