Economy Grows Faster Than Expected Despite Tax Rises and Trump's Trade War

The UK economy grew at a faster rate than expected in the second quarter, official figures show, despite a slowdown from a strong start to the year amid pressure from tax increases and Donald Trump's global trade war.

- Richard Partington

Figures from the Office for National Statistics (ONS) showed growth in gross domestic product slowed to 0.3% in the three months to the end of June, down from a rate of 0.7% in the first quarter.

Although it beat forecasts for a slowdown to 0.1% made by City economists and the Bank of England, the latest snapshot underscores the challenge for the chancellor, Rachel Reeves, as she considers options for boosting the economy and raising revenues at her autumn budget.

Liz McKeown, an ONS director of economic statistics, said: "Growth slowed in the second quarter after a strong start to the year. The economy was weak across April and May, with some activity having been brought forward to February and March ahead of stamp duty and tariff changes, but then recovered strongly in June."

The latest snapshot showed the economy grew 0.4% in June, a faster rate than expected after two consecutive months of shrinking output.

The ONS also revised its initial estimate for April's GDP contraction from -0.3% to -0.1%.