UK economy 'ekes out' 0.1% growth in May

According to today’s ONS data, monthly UK GDP grew by 0.1%, following an unrevised fall of 0.1% in April 2026 and an unrevised growth of 0.3% in March 2026.

The growth in May was because of a rise of 0.3% in services and was partially offset by falls of 0.5% in production and 0.8% in construction.

The economy eked out just 0.1% growth in May, failing to deliver a meaningful rebound from April’s contraction and highlighting just how fragile the UK’s economic recovery remains.

The recent resurgence in tensions in the Middle East has cast fresh doubt over the stability of the recent peace deal, keeping businesses on tenterhooks. Oil prices are already back on the rise, fuelling energy costs and pushing up input prices once again.

At the same time, the Bank of England has made clear that oil-driven inflation remains a key risk, warning that interest rates may need to rise later this year. That raises the prospect of tighter financing conditions at a time when many businesses are already facing a challenging cost environment.

Questions over the future Chancellor and the Burnham government are adding another layer of concern, leaving businesses looking for greater clarity on the Government’s economic direction and whether further tax increases for employers could be on the table.

With growth remaining subdued and uncertainty building on multiple fronts, businesses should focus on strengthening their resilience. Whether that’s managing FX exposure, improving operational efficiency or securing flexible sources of finance, taking proactive steps now will leave firms better placed to navigate any further economic headwinds.