The UK economy delivered an unexpected boost in July, expanding by 0.4%, according to the latest figures from the Office for National Statistics (ONS).
Stronger than expected performance
The stronger-than-anticipated performance confounded economists, who had expected the economy to record no growth during the month.
The July 2026 figures follow growth of 0.3% in June and suggest that the economy carried some of its first-half momentum into the third quarter.
GDP was also 1.6% higher than a year earlier, marking the fastest annual growth rate since February 2025.
AI reportedly assisted growth
Services were the main engine of growth, expanding by 0.4%. Computer programming and consultancy were particularly strong, with the ONS highlighting evidence that businesses involved in artificial intelligence and cloud computing were helping to drive activity.
Manufacturing also performed well, while construction recorded a smaller increase.
Welcome
The figures provide some welcome relief for the government, although economists warn that the outlook remains uncertain.
Rising energy prices, inflationary pressures and higher government borrowing costs could weigh on growth in the months ahead.
Nevertheless, July’s figures suggest the UK economy is proving more resilient than many had expected, providing a positive start to the second half of 2026.