UK economic growth 'subdued' in 2025, ONS says, as GDP rises by 0.1% in final quarter - live updates
1.
'Labour's choices have weakened our economy,' shadow chancellor says
We've also now heard from shadow chancellor Mel Stride, who says this morning's GDP figures show 'Labour’s choices have weakened our economy'.
He adds that GDP per head - another measure of economic growth - 'has actually fallen' for the second quarter in a row.
'These disappointing statistics show a Downing Street and a Treasury that have taken their eye off the ball,' he says on social media platform X, accusing the government of being 'distracted by scandals of their own making'.
'Only the Conservatives have the leader with a backbone, a plan and the team to deliver a stronger economy and get Britain working again.'
For context: The ONS figures show GDP per head fell by 0.1% in both the third and fourth quarters, but grew by 1% over 2025 as a whole.
2.
Chancellor says Labour has right plan to build UK economy
In response to this morning's GDP figures, Chancellor Rachel Reeves says Labour has the right plan to build the UK economy.
'Thanks to the choices we have made, we’ve seen six interest rate cuts since the election, inflation falling faster than predicted and ours is the fastest-growing G7 economy in Europe,' she says.
Germany, France and Italy are the other European nations in the G7, which also includes Japan, Canada and the US.
'The government has the right economic plan to build a stronger and more secure economy, cutting the cost of living, cutting the national debt and creating the conditions for growth and investment in every part of the country.'
As a reminder: The UK economy grew by 0.1% in the final quarter of 2025, and by 1.3% annually, according to ONS figures published this morning. The ONS's director of economic statistics said the picture is one of 'subdued growth'.
3.
Labour's mission is to boost growth, but the UK lost momentum in 2025
The government’s number one mission may be boosting growth but 2025 will go down as one where we made only modest progress, losing momentum over the year.
While the chancellor likes to say the world has changed, some issues appear homegrown.
Many of the businesses I’ve spoken to, particularly in the labour-dependent services sector, point to the impact of government policies - from National Insurance and minimum wage increases to business rates - in pushing up costs and denting hiring. All while they’ve contended with nervous customers, hesitant to spend as they feared tax rises and job uncertainty.
As it stands, the likes of the Bank of England have lowered their growth expectations for 2026, and much of what remains is driven by public spending.
So, how to boost those near-term prospects, make us feeling better off?
Critical will be convincing consumers and businesses that they should shake off the winter blues, feel more confident about spending.
4.
Construction industry experiencing 'continued weakness'
More now from the ONS's Liz McKeown, who says a strong performance by the manufacturing sector, which grew 0.9%, was a major driver of growth last quarter.
Meanwhile, the construction industry showed 'continued weakness', with its largest fall in more than four years, dropping by 2.1%.
Every fortnight, 10,000 businesses provide the ONS with their latest insights, McKeown says.
'They're still citing economic uncertainty as the greatest challenge affecting turnover,' she tells the BBC.
But there are 'early signs of slightly more positive expectations coming through' from those surveys, she says.
5.
Economy showing 'subdued growth' - ONS
We have just heard from Liz McKeown, director of economic statistics at the ONS. She tells BBC Radio 4's Today programme that the picture for the economy is still one of 'subdued growth', based on the latest figures.
Looking at the year as a whole, the rate of growth in 2025 was 1.3%, which is higher than 2024.
There was also growth across 'all main sectors', McKeown says, with the services sector the largest contributor to growth on an annual basis.
But, if we zoom back in on the latest quarter, McKeown says it is 'notable' that there was no growth in the services sector in Q4 - an area of the economy which is 'so often a driver of growth'.
She says it is the 'first time we haven't seen quarterly growth in services in two years'.
6.
Annual growth up slightly in 2025
As for annual growth, GDP is estimated to have increased by 1.3% in 2025, following growth of 1.1% in 2024.
Liz McKeown, director of economic statistics at the ONS, says the rate of economic growth across 2025 as a whole was up slightly on the previous year, 'with growth seen in all main sectors'.
'The often-dominant services sector showed no growth, with the main driver instead coming from manufacturing. Construction, meanwhile, registered its worst performance in more than four years,' she says.
The ONS provides this breakdown:
Services were flat (0% growth)
Production rose 1.2%
Construction was down 2.1%
We'll have more from McKeown when she speaks to BBC Radio 4's Today programme shortly.
7.
Economy also grew by 0.1% in December
As well as the quarterly figure, the ONS also published December's monthly GDP figure this morning.
This shows the economy also grew by 0.1% on a monthly basis.
But the figure for the previous month of November was revised down from 0.3% to 0.2%.
8.
Economy grew by 0.1% in final quarter
Breaking
The economy grew by 0.1% in the final quarter of last year, ONS figures show.
9.
Businesses 'feeling the pinch', financial expert says
We've just heard from Kathleen Brooks, research director at the trading platform XTB, ahead of this morning's ONS release.
She tells BBC News that she expects 2025 to have ended on 'quite a soft note', adding that 'a lot of businesses are really feeling the pinch at the moment'.
That said, there are a couple of 'bright spots', she says, adding that tourism is meant to have ended the year 'on a high', while the recovery at Jaguar Land Rover in November following an earlier cyber attack is expected to have delivered a 'boost to manufacturing'.
Despite some 'little green shoots', she says she is not expecting a strong end to the year overall.
While there has been a 'bit of a bounce' in consumer and manufacturing activity since the Budget, according to Brooks, she says the private sector remains 'very, very weak'.
10.
We're also receiving monthly figures - here's what to expect for December
Lucy Hooker
Business reporter
At the same time as receiving the latest quarterly figures for economic growth, we will also be getting the data for the month of December.
You might think the festive season would be guaranteed to boost growth - all that extra shopping, partying and huge grocery bills.
Remember though that a lot of people take time off in December. Some workplaces shut down entirely for a week. And there's winter flu and bad weather - which interrupts play, especially construction but even the normal commute. All that puts a dampener on economic activity.
But as the ONS will also do the sums on growth over the final three months, or 'quarter' of 2025, that will give a better picture of the strength of UK growth.
11.
UK growth lost momentum last year
Tommy Lumby
BBC business data journalist
This chart shows the UK economy grew in each quarter of 2024, and for most of last year.
But it also shows momentum slowed throughout the first nine months of 2025, and the marginal 0.1% growth in the July-to-September period was below analysts' predictions.
Chancellor Rachel Reeves has previously said there’s 'more to do to build an economy that works for working people'.
We’ll shortly find out if the economy picked up any pace at the end of the year.
12.
What to watch for when the figures land
We want to know whether the UK economy has grown in the three months to December, compared to the previous quarter (July-September).
Economists are predicting the economy increased by about 0.1% over the latest period.
There have been some signs of stronger growth - the revised monthly GDP figures for November suggested a growth rate of 0.3%.
13.
What is GDP?
Today’s figures show how the UK economy is performing, using a measure called GDP – Gross Domestic Product.
GDP measures the size and health of a country’s economy by assessing how much is produced, spent and earned over a period of time.
But the measure doesn’t tell the whole story, especially important aspects of people’s living standards or how wealth is shared.
Generally, economists, politicians, and businesses prefer GDP to grow steadily – as it means people are spending more, more jobs are being created, and more tax is being paid.
If GDP shrinks for two quarters in a row, this is known as a recession, which can lead to pay freezes and job losses.
14.
Latest UK economic growth figures to be released this morning
Katie Williams
Live reporter
At 07:00 GMT we'll get the latest GDP figures from the Office for National Statistics (ONS), showing how much the economy grew in the final quarter of last year.
Economists are expecting modest growth of 0.1%, according to estimates.
While uncertainty in the lead-up to the Budget may have impacted economic activity earlier in the quarter, growth was stronger than expected in November as uncertainty subsided and production at Jaguar Land Rover recovered following an earlier cyber attack.
While modest growth is expected in the final quarter as a whole, economists at the consultancy Pantheon Macroeconomics are expecting 0% growth on a monthly basis in December.
