UK economy shrinks for second month in a row - in blow to Rachel Reeves
UK economy shrinks for second month in a row - in blow to Rachel Reeves
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The UK economy contracted unexpectedly in May as the manufacturing sector suffered another steep decline in activity, according to official figures.
The Office for National Statistics (ONS) said gross domestic product (GDP) contracted by 0.1% in May, following a 0.3% drop in April.
Most economists had expected slight growth of 0.1% in May.
It comes after activity in the manufacturing sector dropped 1%, following a steep fall in April, having surged earlier in the year as US importers stocked up ahead of US President Donald Trump’s tariff rises, which came into effect at the start of April.
Liz McKeown said: “The economy contracted slightly in May with notable falls in production and construction, only partially offset by growth in services.
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“However, across the latest three months as a whole, the economy still grew.
“This reflected strength earlier in the year that resulted, in part, from some activity being brought forward to February and March.”
She added: “While services grew overall in May with a strong month for legal firms, which recovered from a weak April, and computer programming, these were partially offset by a very weak month for retail sales.”