UK ECONOMY FLATLINES IN JULY — Zero growth puts pressure on government ahead of budget
The UK economy stalled in July, with official figures showing zero growth — raising fresh questions about the government’s ability to deliver on its promise of stronger economic performance.
According to the Office for National Statistics (ONS), the flat result followed a 0.4% expansion in June. While monthly numbers can swing sharply, the broader picture shows only modest progress: the economy grew by 0.2% in the three months to the end of July compared with the previous quarter.
The services sector provided some support, boosted by healthcare, computer programming, and office support services. But that was cancelled out by weakness in the manufacturing sector, leaving overall growth stagnant.
With the Budget scheduled for 26 November, Chancellor Rachel Reeves faces mounting pressure to set out a credible path for growth. Many economists speculate she may be forced into tax rises to keep within her self-imposed fiscal rules.
The opposition was quick to pounce. Shadow chancellor Sir Mel Stride said that while any growth is “welcome,” the government is “distracted from the problems the country is facing.” He pointed to soaring borrowing costs — recently hitting a 27-year high — as a sign of crumbling investor confidence, warning that “painful tax rises” now look inevitable under Labour.
