The UK economy unexpectedly contracted in October, official data shows, defying economists’ forecasts.
According to the Office for National Statistics, the economy shrank by 0.1% in October, while analysts had anticipated growth of 0.1%. Over the three months leading up to October, GDP also fell by 0.1%, as manufacturing output dipped and services stalled.
“Within production, there was continued weakness in car manufacturing, with the industry only making a slight recovery in October from the substantial fall in output seen in the previous month,” ONS director of economic statistics Liz McKeown said.
The government has emphasized economic growth as a top priority. A Treasury spokesperson highlighted efforts to stimulate the economy, including reducing energy bills and investing in major infrastructure projects.
“We are determined to defy the forecasts on growth and create good jobs, so everyone is better off, while also helping us invest in better public services,” the spokesperson said.
However, the opposition criticized the government’s fiscal strategy. Shadow chancellor Sir Mel Stride blamed the Budget for the contraction, accusing the government of misleading the public.
“For months, Rachel Reeves has misled the British public. She said she wouldn’t raise taxes on working people – she broke that promise again. She insisted there was a black hole in the public finances – but there wasn’t,” Stride said.
Production output fell by 0.5% over the three months to October, largely due to a 17.7% slump in vehicle manufacturing. Jaguar Land Rover’s plants were halted in September following a cyber-attack, with a phased return to production beginning in early October.
While vehicle manufacturing picked up slightly, the ONS noted that output remained below August levels.
Services, encompassing sectors like professional services and retail, showed no growth over the three-month period.
A bar chart of monthly UK GDP growth from October 2023 to October 2025 illustrates the economy’s fluctuating performance: Oct 2023 (-0.4%), Nov 2023 (0.3%), Dec 2023 (-0.3%), Jan 2024 (0.5%), Feb 2024 (0.2%), Mar 2024 (0.5%), Apr 2024 (0.0%), May 2024 (0.4%), Jun 2024 (-0.2%), Jul 2024 (0.0%), Aug 2024 (0.3%), Sep 2024 (0.0%), Oct 2024 (-0.1%), Nov 2024 (0.1%), Dec 2024 (0.4%), Jan 2025 (-0.1%), Feb 2025 (0.4%), Mar 2025 (0.3%), Apr 2025 (-0.2%), May 2025 (0.0%), Jun 2025 (0.4%), Jul 2025 (-0.1%), Aug 2025 (0.0%), Sep 2025 (-0.1%), Oct 2025 (-0.1%).
Ruth Gregory, deputy chief UK economist at Capital Economics, said the surprise contraction strengthens the case for the Bank of England to cut interest rates at next week’s meeting.
“It’s striking that the economy has only grown in one of the past seven months,” she said.
Jack Meaning, UK chief economist at Barclays and a former Bank of England adviser, told the BBC’s Today programme that the figures highlight an economy that is “unambiguously weak.”
“It’s continuing the story we’ve seen more or less all the way through this year of growth decelerating from relatively strong numbers at the start to much weaker numbers now, and actually outright contraction,” he said.
“Ultimately part of the story today is that we didn’t see as much of a bounce-back of that Jaguar Land Rover closure as we had expected. We thought that would all bounce back pretty quickly; it looks like it might take a little bit longer.”
Mr Meaning also pointed out that Barclays’ data suggest the uncertainty surrounding the Budget led consumers to delay purchases and major spending decisions.
