UK GDP edges up 0.1% in August

UK gross domestic product grew by 0.1% in August 2026, a smaller increase than the 0.4% expansion recorded in July but stronger than economists had forecast. Consensus expectations had pointed to a 0.1% monthly contraction, meaning the economy once again outperformed predictions despite a loss of momentum from earlier in the summer.

The August figures indicate that the UK economy continued to expand, but at a reduced pace compared with the previous two months. Market surveys ahead of the release had suggested a weaker outcome, reflecting concerns about softer activity across key sectors.

Growth in August was driven by industrial output. Overall production rose 0.8% on the month, while manufacturing output increased by 1.2%. These gains contrasted with expectations for declines in both indicators and helped prevent GDP from slipping into negative territory.

Services activity, which accounts for the largest share of the UK economy, was flat in August. Construction output declined, adding a drag to overall performance. The data underline that the latest growth was not broad-based, relying heavily on manufacturing and other production sectors to offset softness in services and construction.

Industrial production data for August showed a stronger picture than anticipated by forecasters. Production’s 0.8% monthly increase compared with consensus expectations for a fall of 0.1%. Manufacturing’s 1.2% rise also exceeded forecasts that had pointed to a decline.

Earlier figures had shown more moderate gains in industrial activity, but the latest month’s performance marked a notable upside surprise. Within production, manufacturing was a key contributor, helping to sustain overall economic growth at a time when other sectors showed little or no expansion.

Taken together, the August data suggest that the UK economy is still growing but with clear signs of uneven performance across sectors. Industrial and manufacturing strength are providing support, while flat services and weaker construction highlight lingering pockets of softness.

The pattern of slower GDP growth compared with July, combined with outperformance relative to forecasts, paints a mixed picture. Output is expanding and avoiding contraction, yet the reliance on a narrow set of sectors raises questions about the durability of the current growth path if industrial momentum were to ease.