UK Economy Beats Forecasts with 0.4% Q3 Growth Driven by Services Sector

The UK economy has experienced a modest but steady recovery in the third quarter of 2025, with GDP expanding by 0.4% quarter-on-quarter.

This growth beats analyst forecasts of 0.2%, driven primarily by a strong performance from the services sector, which accounts for around 80% of UK economic output.

The services sector's growth was broad-based across most industries, with key contributors including professional services, scientific and technical activities, and the information and communication sector.

Consumer-facing services such as hospitality and retail showed resilience despite ongoing cost-of-living pressures, but the economy still faces significant challenges, including regional disparities and sluggish business investment.