UK GDP has dropped once again, defying expectations of a slight increase in the month of May.
ONS reports that the monthly real gross domestic product (GDP) fell by 0.1% in May. This follows a decline in April of 0.3%.
While monthly services output grew by 0.1% in May, production output fell by 0.9% and construction output fell by 0.6%.
The disappointing numbers will put pressure on the Bank of England to reduce benchmark rates at the next meeting. The report will also draw attention to the Chancellor of the Exchequer, Rachel Reeves’ plan to revive the economy. It has been reported that Reeves said the numbers were “disappointing.”
Douglas Grant, Group CEO of Manx Financial Group, said the UK economy continues to be week and British SMEs are under “acute pressure” as the cost of living squeeze persists and geopolitical instability remains.
“Businesses urgently need to rethink their financial frameworks to strengthen stability and resilience. Regular budget reviews, agile supply chains, and strategic bulk purchasing can help offset rising costs, while embracing new technologies and streamlining operations will drive productivity and efficiency gains,” said Grant.
He stated their internal research indicated that SMEs have had to pause or stop parts of their business in the last two years due to a lack of capital.
Without light at the end of the economic tunnel, the Labour government will continue to take arrows as critics hammer the lack of traction with their plans to reanimate the UK economy.
UK GDP declined 0.1% in May after 0.3% decline in April. Looks like Q2 will show decline overall. So perhaps ministers can now stop spouting nonsense about being the ‘fastest growing economy in the G7’.
As some of us have pointed out, it was always going to look a forlorn boast…— Andrew Neil (@afneil) July 11, 2025