UK GDP expanded by 0.2% in March, following a 0.5% increase in February, driven primarily by a 0.4% growth in the services sector and a 0.5% rise in construction output. Despite the overall positive trajectory, production fell by 0.7% due to manufacturing declines. Analysts express cautious optimism as the quicker GDP in Q1 marks significant growth, although looming tariff implications and rising costs may hinder sustainable progress moving forward, prompting concerns of instability in the upcoming months as new regulations take shape.
With the winds of tariff turmoil whipping up economic seas, today's better than expected GDP figures for the UK show an economy that has so far been able to navigate itself to calmer waters. Output grew during the month across two of the three major sectors, with the economic engine, the services sector growing by 0.4%. Construction saw solid progress whilst production slipped due to falls in the manufacturing sector. UK GDP grew at a faster rate of knots during the first quarter and its fastest rate in three quarters.
While today's figures are a tentative step in the right direction, this is still far from sustainable economic growth and certainly no cause for complacency. With official figures this week estimating the number of payrolled employees down more than 100,000 over the last year, there are clear signs that the increased costs and risks of giving someone a job are having a direct impact.
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