UK Q4 GDP Up 0.1% Last Year...Annual Growth at 1.3%

The United Kingdom's gross domestic product (GDP) in the fourth quarter of last year rose 0.1% quarter-on-quarter, the Office for National Statistics (ONS) said on the 12th (local time). This fell short of the market consensus of 0.2%.

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Growth in the United Kingdom in the fourth quarter of last year was driven by government spending, which increased by 0.4%. Consumer spending rose only 0.2%. Business investment fell 2.7%, marking the largest decline since early 2021. Manufacturing output increased by 0.9%, but construction contracted by 2.1%. Real GDP per capita declined by 0.1% in the fourth quarter, following a 0.1% drop in the third quarter of last year.

The United Kingdom's annual growth rate last year was 1.3%, higher than the previous year (2024), when it was 1.1%, and also above the market forecast of 1.0%. This outpaced major European countries such as France (0.9%), Italy (0.7%), and Germany (0.4%). Prime Minister Keir Starmer said on social media (SNS), "Today's GDP figures show that our economy is growing," adding, "We know there is more work to do, but we are heading in the right direction."

However, this sluggish pace of economic growth is expected to pose challenges for the Labour government going forward. The United Kingdom is set to hold major elections in May.