“These figures confirm that the UK economy ended 2025 with a whimper as weaker confidence and steepling cost pressures helped limit output across the fourth quarter, including through minimal growth in December.
“Businesses had a particularly bleak quarter as the dark cloud of uncertainty caused by the Budget and higher costs severely curtailed trade and investment plans.
“The underwhelming final quarter caps off another disheartening year for the UK economy with growth tailing off unnervingly quickly after the strong start to 2025, as rising taxes, heightened uncertainty and poor productivity increasingly squeezed activity.
“The UK economy should see slightly stronger growth in this current quarter with reduced uncertainty now the Budget is in the rear-view mirror, and lower inflation likely to boost consumer spending and business activity, despite higher unemployment.
“These figures mean that a March interest rate cut remains doubtful by giving those policymakers wanting more evidence that inflation is slowing comfort over economic conditions to delay reducing rates, particularly given the elevated political uncertainty.”
ENDS
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* includes parent companies. Source: ICAEW member data March 2025, Interbrand, Best Global Brands 2024.
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