UK economy grew by 0.6% in first quarter of 2026

Latest figures from the Office for National Statistics (ONS) have shown that the UK economy expanded by 0.6% in the first quarter of 2026, unchanged from the preliminary estimate and a clear acceleration from 0.1% growth in Q4 2025, which was revised down from 0.2%. Annual GDP growth was revised to 0.9%, down from the previous estimate of 1.1%.

Private consumption rose 0.6% quarter-on-quarter, government spending increased 1.3%, gross fixed capital formation rose 0.4%, exports edged up 0.2% and imports rose 1.4%.

Business investment increased 0.9% quarter-on-quarter, but remained 1.3% lower year-on-year, while the current account deficit stood at £22.1bn.

Liz McKeown, Director of Economic Statistics at the ONS, said: “Services were the main driver of growth in the latest quarter, with strengths in computer programming, wholesale and advertising only offset by falls in rental companies and recruitment agencies.”

Mike Randall, CEO at Simply Asset Finance, said: “Today’s figures confirm the economy made a steady start to the year, but business confidence is still finely balanced. Most firms aren’t short of ambition, but are thinking carefully about every decision, from hiring and stock to equipment and expansion.

“With recent data showing 40% of SMEs are permanent non-borrowers, and would rather ‘grow slowly’ than borrow to grow, the challenge is not just about making finance available. It is about making it feel clear, practical and worth the risk.

“While we wait tentatively for the next chapter in Westminster, whoever steps into No.10 will need to understand the levers that actually unlock growth, including giving SMEs the confidence and financial support to invest rather than hold back.”