London Daily

Focus on the big picture.
Wednesday, Jan 14, 2026

UK economy grew less than expected in August, as recovery from the coronavirus pandemic slows

UK economy grew less than expected in August, as recovery from the coronavirus pandemic slows

The data from the Office for National Statistics showed that GDP remained 9.2% lower than in February, before the full impact of the pandemic was felt.

The U.K. economy grew 2.1% in August on a monthly basis, as the country’s gradual recovery from the coronavirus crisis continued, albeit at a slightly slower pace.

August’s estimated growth in GDP (gross domestic product) was lower than expectations, with economists polled by Reuters expecting a monthly expansion of 4.6%. It follows an expansion of 6.4% in July, 9.1% in June and 2.7% in May, following a record 19.5% plunge in April, according to the Office for National Statistics.

Friday’s data from the Office for National Statistics showed that August GDP remained 9.2% lower than in February, before the full impact of the pandemic was felt.

GDP grew 8% in the three months to August as lockdown measures began to ease, according to the ONS.

The U.K.’s dominant services sector grew by 2.4% in August, following growth of 5.9% in July. It was boosted in large part by almost 70% growth in the food and beverage services industry, which the ONS attributed to easing of restrictions and the government’s “Eat Out to Help Out” scheme.

The country’s emergence from lockdown in recent months has paved the way for a recovery in many sectors of the economy, but cases of Covid-19 have been growing exponentially in recent weeks as a second surge appears to be underway.

The British government has imposed a 10 p.m. curfew for bars and restaurants across the U.K., with further restrictions expected in the coming weeks.

As of Friday morning, the U.K. has confirmed 564,502 cases and 42,682 deaths, according to data compiled by Johns Hopkins University.

On September 24, U.K. Finance Minister Rishi Sunak announced a new emergency package of measures to contain unemployment, replacing the country’s furlough scheme which is due to expire this month.

‘A long, difficult winter’


“With recent surveys pointing to activity softening in September, and the potential for further and more stringent localized restrictions on activity, doubt is growing as to whether the recovery can be sustained into the final quarter of the year,” UBS Wealth Management Economist Dean Turner said Friday.

“Sluggish progress is likely to encourage the Bank of England to increase its bond buying program (QE) at its November meeting.”

Since the onset of the pandemic, the central bank has cut its main lending rate twice from 0.75% to 0.1% and deployed a £745 billion ($964.6 billion) asset purchase program in a bid to shore up the economy.

“While there are positive indications from the Bank of England of growth returning to pre pandemic levels before Christmas, this is far from a done deal,” said Tom Stevenson, investment director for personal investing at Fidelity International.

“The furlough scheme comes to an end this month and there is a real danger that fear of unemployment triggers a negative feedback loop of precautionary saving and dampens consumer confidence.”

With the prospect of further localized lockdown measures being introduced Monday, Stevenson said the country was bracing itself for a “long, difficult winter.”

Newsletter

Related Articles

0:00
0:00
Close
UK Intensifies Arctic Security Engagement as Trump’s Greenland Rhetoric Fuels Allied Concern
Meghan Markle Could Return to the UK for the First Time in Nearly Four Years If Security Is Secured
Meghan Markle Likely to Return to UK Only if Harry Secures Official Security Cover
UAE Restricts Funding for Emiratis to Study in UK Amid Fears Over Muslim Brotherhood Influence
EU Seeks ‘Farage Clause’ in Brexit Reset Talks to Safeguard Long-Term Agreement Stability
Starmer’s Push to Rally Support for Action Against Elon Musk’s X Faces Setback as Canada Shuns Ban
UK Free School Meals Expansion Faces Political and Budgetary Delays
EU Seeks ‘Farage Clause’ in Brexit Reset Talks With Britain
Germany Hit by Major Airport Strikes Disrupting European Travel
Prince Harry Seeks King Charles’ Support to Open Invictus Games on UK Return
Washington Holds Back as Britain and France Signal Willingness to Deploy Troops in Postwar Ukraine
Elon Musk Accuses UK Government of Suppressing Free Speech as X Faces Potential Ban Over AI-Generated Content
Russia Deploys Hypersonic Missile in Strike on Ukraine
OpenAI and SoftBank Commit One Billion Dollars to Energy and Data Centre Supplier
UK Prime Minister Starmer Reaffirms Support for Danish Sovereignty Over Greenland Amid U.S. Pressure
UK Support Bolsters U.S. Seizure of Russian-Flagged Tanker Marinera in Atlantic Strike on Sanctions Evasion
The Claim That Maduro’s Capture and Trial Violate International Law Is Either Legally Illiterate—or Deliberately Deceptive
UK Data Watchdog Probes Elon Musk’s X Over AI-Generated Grok Images Amid Surge in Non-Consensual Outputs
Prince Harry to Return to UK for Court Hearing Without Plans to Meet King Charles III
UK Confirms Support for US Seizure of Russian-Flagged Oil Tanker in North Atlantic
Béla Tarr, Visionary Hungarian Filmmaker, Dies at Seventy After Long Illness
UK and France Pledge Military Hubs Across Ukraine in Post-Ceasefire Security Plan
Prince Harry Poised to Regain UK Security Cover, Clearing Way for Family Visits
UK Junk Food Advertising Ban Faces Major Loophole Allowing Brand-Only Promotions
Maduro’s Arrest Without The Hague Tests International Law—and Trump’s Willingness to Break It
German Intelligence Secretly Intercepted Obama’s Air Force One Communications
The U.S. State Department’s account in Persian: “President Trump is a man of action. If you didn’t know it until now, now you do—do not play games with President Trump.”
Fake Mainstream Media Double Standard: Elon Musk Versus Mamdani
HSBC Leads 2026 Mortgage Rate Cuts as UK Lending Costs Ease
US Joint Chiefs Chairman Outlines How Operation Absolute Resolve Was Carried Out in Venezuela
Starmer Welcomes End of Maduro Era While Stressing International Law and UK Non-Involvement
Korean Beauty Turns Viral Skincare Into a Global Export Engine
UK Confirms Non-Involvement in U.S. Military Action Against Venezuela
UK Terror Watchdog Calls for Australian-Style Social Media Ban to Protect Teenagers
Iranian Protests Intensify as Another Revolutionary Guard Member Is Killed and Khamenei Blames the West
Delta Force Identified as Unit Behind U.S. Operation That Captured Venezuela’s President
Europe’s Luxury Sanctions Punish Russian Consumers While a Sanctions-Circumvention Industry Thrives
Berkshire’s Buffett-to-Abel Transition Tests Whether a One-Man Trust Model Can Survive as a System
Fraud in European Central Bank: Lagarde’s Hidden Pay Premium Exposes a Transparency Crisis at the European Central Bank
Trump Announces U.S. Large-Scale Strike on Venezuela, Declares President Maduro and Wife Captured
Tesla Loses EV Crown to China’s BYD After Annual Deliveries Decline in 2025
UK Manufacturing Growth Reaches 15-Month Peak as Output and Orders Improve in December
Beijing Threatened to Scrap UK–China Trade Talks After British Minister’s Taiwan Visit
Newly Released Files Reveal Tony Blair Pressured Officials Over Iraq Death Case Involving UK Soldiers
Top Stocks and Themes to Watch in 2026 as Markets Enter New Year with Fresh Momentum
No UK Curfew Ordered as Deepfake TikTok Falsely Attributes Decree to Prime Minister Starmer
Europe’s Largest Defence Groups Set to Return Nearly Five Billion Dollars to Shareholders in Twenty Twenty-Five
Abu Dhabi ‘Capital of Capital’: How Abu Dhabi Rose as a Sovereign Wealth Power
Diamonds Are Powering a New Quantum Revolution
Trump Threatens Strikes Against Iran if Nuclear Programme Is Restarted
×