Figures from the Office for National Statistics (ONS) show gross domestic product rose by 0.3% in the second quarter, down from 0.7% in the first three months of 2025. The performance was stronger than the 0.1% growth most economists had forecast, aided by a surprise rebound in June and revisions to earlier data.

June’s 0.4% monthly growth followed contractions in both April and May, fuelled by strength in scientific research, engineering, car sales and electronics manufacturing. Services – particularly computer programming, health and vehicle leasing – provided the biggest lift over the quarter.

Liz McKeown, the ONS’s director of economic statistics, said: “Growth slowed in the second quarter after a strong start to the year. The economy was weak across April and May, with some activity having been brought forward to February and March ahead of stamp duty and tariff changes, but then recovered strongly in June.”

Chancellor Rachel Reeves hailed the figures as “positive” but said there was “more to do to deliver an economy that works for working people”.

Economists warned that the headline numbers masked weaker underlying trends. Sanjay Raja, chief UK economist at Deutsche Bank, said: “The biggest contributor to GDP growth came via government spending. What disappointed? Household spending – the growth engine of the UK economy – nearly stalled, coming in at a paltry 0.1% quarter-on-quarter.”

The slowdown adds to the Bank of England’s dilemma as it considers further interest rate cuts. Lower borrowing costs could support growth, but policymakers are also facing stubborn inflation that threatens to complicate their next move.