LONDON, The UK economy expanded by 0.6% in the first quarter of 2025, according to the latest figures released by the Office for National Statistics (ONS). This growth exceeded market expectations, highlighting resilience in the face of ongoing domestic and international uncertainties.
The services sector was the primary driver of growth, contributing significantly to the overall increase. Key industries such as finance, information technology, and professional services showed robust performance, helping to offset slower activity in manufacturing and construction.
Despite the positive start to the year, economists warn that the economic outlook remains cautious. Rising geopolitical tensions, particularly in global trade, continue to pose risks to export-dependent sectors. Additionally, domestic policy challenges, including inflation pressures and fiscal constraints, could dampen consumer spending and business investment in the coming months.
The Bank of England’s recent decision to cut the base interest rate to 4.25% reflects attempts to balance inflation control with supporting economic growth. Inflation itself has shown signs of easing, with the Consumer Price Index (CPI) rising 2.6% in the 12 months to March 2025, down from 2.8% in February, though core inflation remains a concern.
Analysts suggest that while the UK economy has started 2025 on a positive note, uncertainties remain. The interplay of global economic trends and domestic policies will be crucial in determining whether growth momentum can be sustained throughout the year.
