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Economic indicators: Key statistics for the UK economy

Summary

Six months on from its beginning, the current Israel/US conflict with Iran continues to affect the UK economy. However, indicators suggest that the economy is coping better than forecasters expected.

Gross domestic product (GDP) and productivity

GDP is estimated to have grown by 0.4% in April to June 2026 compared to the previous three-month period (January to March 2026). Eurozone GDP grew by 0.4% in April to June 2026.

Services output was up by 1.5% in April to June 2026 compared to the previous year.

Manufacturing output increased by 1.2% over the same period.

Productivity across the whole UK economy decreased by 1.2% in Q2 2026 compared with the previous quarter. Compared with the previous year, it was down by 0.2%.

Inflation and interest rates

CPI inflation was 2.9% in July 2026, up from 2.6% in June. Inflation in the Eurozone was 2.9% in July 2026, up from 2.8% in June.

The Bank of England’s Monetary Policy Committee (MPC) left interest rates unchanged at 3.75% on 30 July. Rates have been cut by 1.5 percentage points overall since August 2024.

Earnings and employment

Average wages excluding bonuses were 3.5% higher in the three months to June 2026 compared with the year before, and 0.7% higher after adjusting for inflation. CPI inflation for this period was 2.8%.

Data from the Labour Force Survey shows that 34.47 million people were in employment in April to June 2026, up 253,000 from a year before (but note that other data shows a fall in payrolled employees of 86,000 over the same period). The employment rate was 75.1%, down from 75.3% the previous year.

1.77 million people were unemployed in April to June 2026, up 88,000 from the year before. The unemployment rate was 4.9%. The UK harmonised unemployment rate for Q1 2026 was 5.0%, above the rate of Germany (3.8%) and the US (4.3%) but below that of France (8.1%).

Public finances

Government borrowing in the first four months of the 2026/27 financial year was £57 billion, which is £6 billion less than the amount borrowed during the same period in 2025/26.

At the end of July 2026, public sector net debt was equivalent to 94.1% of GDP, compared to 94.9% a year before.

Trade and exchange rates

The UK had a trade deficit of £8.0 billion in the three months to June 2026, compared to a deficit of £7.7 billion in the three months to March 2026.

The current account deficit was £15.1 billion in Q2 2026 (1.9% of GDP), down from £18.2 billion in Q1 2026 (2.4% of GDP).

The value of sterling increased by 0.9% between June and July 2026, having fallen by 0.3% between May and June. Compared with a year ago, it is 0.6% lower.

Retail sales and consumer confidence

The volume of retail sales rose by 1.1% in the three months to July 2026 compared with the previous three months, and increased by 3.0% compared with the previous year.

GfK’s Consumer Confidence Index, which measures consumer attitudes, was at -14 in August 2026, up three points from July.

House prices

House prices increased by 2.0% over the year to June 2026.

Household debt

Household debt stood at 117.2% of disposable income in Q1 2026. This ratio has generally been decreasing since 2022.

Economic indicators are quick-read summaries of the latest data focusing on different aspects of the UK economy. The full suite of indicators can be found on the main Economic Indicators page.