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Latest news on the UK economy, covering GDP growth, inflation, interest rates, unemployment, Rachel Reeves, the budget, cost of living and the British economy.

The United Kingdom's economy is one of the world's largest, contributing around £3 trillion in annual output. As the Labour government pursues its growth agenda under Chancellor Rachel Reeves, the British economy faces a complex mix of modest recovery, persistent inflation, and mounting fiscal pressures. Key indicators — from GDP and employment to mortgage rates and retail sales — are closely watched by households, businesses, and international investors alike.

GDP growth has been sluggish, with the economy expanding by just 0.1% in each of the final two quarters of 2025, before picking up to 0.5% in the three months to February 2026. CPI inflation stood at 3.3% in March 2026, above the Bank of England's 2% target, driven by rising fuel and food prices. The Bank's Monetary Policy Committee held interest rates at 3.75% in April 2026, as policymakers weighed the risk of cutting too soon against weakening growth forecasts. The OECD and IMF have both revised UK growth projections downward, citing energy market disruption and global uncertainty.

The labour market is under growing pressure. Unemployment has risen to around 5.2%, with forecasts suggesting it could climb further as businesses absorb higher employer National Insurance contributions introduced in the 2024 Autumn Budget. US tariffs have also hit UK exporters, with goods exports to the United States falling sharply from early 2025. Consumer confidence remains fragile, with household spending growth well below historical norms and energy bills continuing to squeeze disposable incomes, particularly for lower-income families.

The UK economy's modern challenges have deep structural roots. A decade of low productivity growth, the disruption of Brexit to trade relationships, and successive external shocks have left the economy underperforming many of its G7 peers in terms of GDP per capita growth. The government's 2025 spending review set out Labour's priorities for public investment, with defence, infrastructure, and public services all competing for constrained resources. Managing the national debt, meeting fiscal rules, and reviving private sector investment remain the central tensions of British economic policy.

From the Bank of England's interest rate decisions and OBR forecasts to Rachel Reeves's budget statements and ONS data releases, the NewsNow UK Economy feed is your one-stop source for the most relevant headlines as they break. Whether you follow the pound, the FTSE, property prices, or wage growth, stay informed with comprehensive, real-time coverage of everything shaping the British economy.