The UK economy posted a cleaner end to 2025 than markets expected, easing fears that autumn weakness was turning into something more persistent. Office for National Statistics data showed GDP grew 0.3% in November after an October decline, beating the 0.1% consensus cited by economists polled by Reuters. The rebound comes as policymakers and businesses try to gauge how much runway the Bank of England has to keep cutting rates into 2026.
The composition matters for the “how.” Services rose 0.3% and production jumped 1.1%, while construction fell 1.3%, according to the ONS breakdown. CNBC also noted sterling was largely unchanged after the release, last around $1.3433, suggesting investors saw the surprise as helpful but not yet decisive for the broader rate path.
Why the bounce now. October’s weakness was tied in part to a Jaguar Land Rover cyberattack that hit production, plus pre Budget uncertainty. Bloomberg highlighted the industrial recovery after the cyberattack as a key driver of November’s pick up. That framing implies the November strength is partly normalization, not purely new demand, which is crucial for judging whether growth can sustain into Q1.
Next steps likely center on the BoE’s easing cadence and whether improving surveys translate into real activity. Deutsche Bank expects a stronger start to 2026 and sees 2026 growth slightly below 2025’s 1.1%, with quarterly growth around 0.35% quarter on quarter, per its comments. A stabilizing labor market would strengthen the case for continued cuts. Renewed weakness in construction and hiring would do the opposite.
Use this print as confirmation that the UK is not stalling, but also as a reminder to separate one off rebounds from trend growth. The next monthly GDP and labor market data will determine whether November was a blip or the start of a steadier 2026.
