UK economy continued to flatline in month Labour came to power - official figures

There was no growth in the UK economy in July, official figures show.

It's the second month of stagnation, the Office for National Statistics (ONS) said as GDP - the measure of everything produced in the UK - flatlined in the weeks following the election of the Labour government.

Such news was not expected by economists, who had forecast growth.

Economists polled by the Reuters news agency forecast the economy would expand by 02.%.

Some signs of growth

But there's "longer term strength" in the services sector meaning there was growth over the last three months as a whole and 0.5% expansion in the three months up to July.

Among the G7 group of industrialised nations, the UK had the highest growth rate for the first six months of 2024.

Why stagnation?

While there was growth in the services sector, led by computer programmers and the end of strikes in health, these gains were offset by falls for advertising companies, architects and engineers.

Manufacturing output fell overall due to "a particularly poor month for car and machinery firms", the ONS said while construction also declined.

In response to the figures Chancellor Rachel Reeves said:

"I am under no illusion about the scale of the challenge we face and I will be honest with the British people that change will not happen overnight. Two-quarters of positive economic growth does not make up for fourteen years of stagnation.

"That is why we are taking the long-term decisions now to fix the foundations of our economy,

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