The UK economy expanded in July, even as repercussions from the Iran conflict lingered, providing encouraging news for John Healey ahead of the upcoming budget.
According to the Office for National Statistics, gross domestic product rose 0.4% in July, up from 0.3% in June.
City analysts had projected no growth.
Amid ongoing Middle East turmoil that continues to unsettle global markets, the announcement arrives as the UK government’s borrowing costs climb to their highest point in nearly two decades.
Economists caution that the surge in global oil prices—now exceeding $100 a barrel—could fuel higher inflation worldwide.
In the first half of 2026, Britain posted the strongest growth among G7 nations, even as the conflict began.
Economists warn that the chancellor may need to raise taxes or reduce spending in his first budget on 28 October, as rising interest rates—sparked by the Iran‑war‑induced turmoil in global bond markets—mount pressure on fiscal policy.
Further details will be provided shortly.
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