UK Economy Grows 0.1% in August
The small increase beats forecasts and is driven by production growth, ahead of the chancellor's Budget at the end of the month
Story timeline2 updates
UK GDP grew 2.1% annually in August, beating expectations of 1.7%.
Story published. The small increase beats forecasts and is driven by production growth, ahead of the chancellor's Budget at the end of the month
The UK economy posted a 0.1% growth in August, beating forecasts and driven by an increase in production, according to the Office for National Statistics.
This small increase follows growth of 0.4% in July. The services industry, which makes up the largest chunk of the UK's economy, was flat during the month, while the construction sector contracted.
The International Monetary Fund (IMF) recently praised the UK's plans to cut debt levels, with managing director Kristalina Georgieva saying the country was seeing 'a bit of a better growth prospect' than other G7 nations.
Chancellor John Healey will deliver the Budget at the end of the month, where he will set out his tax and spending plans. He faces a challenge to deliver a balanced Budget without turning to more borrowing.
## Why it matters The UK economy's growth is significant as it comes ahead of the chancellor's Budget and amidst global economic shocks. The IMF's praise of the UK's plans to cut debt levels and its positive outlook for the country's economy are also important factors. The growth in August, although small, is a positive sign for the UK economy, and the chancellor's Budget will be closely watched to see how he plans to build on this growth.
