UK GDP: Defying the pessimists (in November at least)

The UK’s gross domestic product (GDP) in November 2025 was stronger than expected delivering 0.3% month-on-month after slumping -0.1% month-on-month in October.

Consensus expectations had been for growth of only 0.1% month-on-month in the month the Budget was held. Given reports that consumers and businesses were waiting for the outcome of the late November Budget, this is an especially encouraging set of data even if the underlying detail is mixed.

The UK economy in aggregate continues to defy the most pessimistic observers. Still, this remains an economy that isn’t growing much.

With the purchasing manager indices (PMIs) pointing to modest positive growth at the turn of the year, the UK economy in aggregate continues to defy the most pessimistic observers. Still, this remains an economy that isn’t growing much and labour market data continues to send some worrying signals – we’ll get the next set of labour market data on Tuesday (20 January).

This has been a somewhat bumpy period, and rolling three-month on three-month GDP growth was 0.1% (after 0% in October 2025). If December GDP was flat, then Q4 would mechanically be on record with a not-very-impressive 0.2% quarter-on-quarter after 0.1% quarter-on-quarter in Q3 (assuming no back revisions).

Looking at the detail for November

Construction output fell 1.3% month-on-month, but there was again a strong gain in industrial production, driven by a big jump in manufacturing production. The main driver there was manufacture of transport equipment as production continued to recover after the Jaguar Land Rover cyberattack.  

Services output rose 0.3% month-on-month after a fall of 0.3% month-on-month, again stronger than expected. Looking below the surface, the picture was mixed for services, but with strong positive contributions from ‘professional, scientific and technical activities’ (though this follows falls in the previous four months and, with tax consultancy one of the drivers, the later than usual Budget may perhaps have played a role); information and communication; and wholesale/retail. The Office for National Statistics notes though, that the output of consumer-facing services fell 0.2% month-on-month in November (driven by real estate).

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