With growth rates presented her economy Britain After being better off the expected quarter in the second quarter, somewhat relieving Finance Minister Rachel Reeves, but increasing expectations for further interest rates cuts by the Bank of England (BOE).
In particular, Britain’s gross domestic product increased by 0.3%, according to figures announced Thursday (14.8.2025) by the National Statistical Service, exceeding 0.1% of both private and BOE economists. Only in June, production increased by 0.4% – twice as much as expectations – after minor reductions in the previous two months.
Evidence shows that The economy endured during a period that was expected to be difficultas businesses and consumers have been hit by an increase in salary tax by $ 26 billion ($ 35.2 billion) imposed by Ribs, increases in regulated prices, such as energy, which led to inflation, increasing taxes for housing, and US duties.
The growth of 0.7% in the first quarter was artificially strengthened by manufacturers who were trying to prevent US duties, although Prime Minister Kir Starmer has repeatedly welcomed Britain over other countries of the Seven Group as proof that the economy has crossed the threshold.
The figures also seem to further complicate BOE’s decision on whether it will continue to reduce interest rates from current 4%, as Tuesday’s statistics showed that the economy has lost less jobs than initially estimated after the River tax budget in October. Investors no longer fully calculate a further reduction this year and expect that the borrowing costs will stabilize at 3.5% next year.
Boe cited the weakening of activity last week when it reduced interest rates for the fifth time in one year. However, almost half of the Monetary Policy Committee opposed the decision, citing concerns about the recent increase in inflation.
The economy, however, is facing significant adversity, at a time when Reeves and Starmer are based on growth to finance their expenditure, following recent upheavals of social benefit cuts, which have made it even more difficult to make a difficult fiscal situation.
In an article in the Guardian newspaper this morning, Reeves described the prospect of further tax increases as a guess and stated that its autumn budget would try to improve Britain’s weak productivity.
“As in the last 12 months I have focused on stimulating economic growth for the benefit of workers, so will I do in the future,” he said.
“If renewal is our mission and productivity our challenge, then investment and reforms are our tools,” Reeves added, referring to plans for more constructions, better infrastructure and release of the design system.