Economic indicators: Key statistics for the UK economy

Summary

The first economic effects of the US/Israeli conflict with Iran are showing in real-time data and in forecasts. However, it remains to be seen whether temporary supply chain disruption will lead to longer-term structural changes such as diversifying supplier bases or rerouting trade flows.

On 28 February 2026, Israel and the US launched strikes against Iran. In response, Iran announced it would close the Strait of Hormuz, a passage for roughly one fifth of fifth of global oil and gas trade, and shipping through the Strait has largely ceased. The Strait remains subject to a US naval counter-blockade despite a ceasefire being announced on 8 April 2026.

The new session of Parliament began on 13 May with the King’s Speech, and the government already has a lot to deal with in economic terms. Although both inflation and economic growth have beaten forecasts in the past month, there are signs that this may not last.

Gross domestic product (GDP) and productivity

GDP is estimated to have grown by 0.6% in January to March 2026 compared to the previous three-month period (October to December 2025). Eurozone GDP grew by 0.1% in January to March 2026.

Services output was up by 1.4% in January to March 2026 compared to the previous year.

Manufacturing output increased by 0.5% over the same period.

Productivity across the whole UK economy increased by 0.9% in Q1 2026 compared with the previous quarter. Compared with the previous year, it was up by 0.4%.

Inflation and interest rates

CPI inflation was 2.8% in April 2026, down from 3.3% in March. Inflation in the Eurozone was 3.0% in April 2026, up from 2.6% in March.

The Bank of England’s Monetary Policy Committee (MPC) left interest rates unchanged at 3.75% on 30 April. Rates have been cut by 1.5 percentage points overall since August 2024.

Earnings and employment

Average wages excluding bonuses were 3.4% higher in the three months to March 2026 compared with the year before, and 0.3% higher after adjusting for inflation. CPI inflation for this period was 3.1%.

Data from the Labour Force Survey shows that 34.39 million people were in employment in January to March 2026, up 416,000 from a year before (but note that other data shows a fall in payrolled employees of 94,000 over the same period). The employment rate was 75.0%, about the same as the previous year.

1.81 million people were unemployed in January to March 2026, up 192,000 from the year before. The unemployment rate was 5.0%. The UK harmonised unemployment rate for Q4 2025 was 5.2%, above the rate of Germany (3.8%) but below that of France (7.7%).

Public finances

Government borrowing in the 2025/26 financial year was £129 billion, which is £23 billion less than the amount borrowed in 2024/25.

At the end of April 2026, public sector net debt was equivalent to 94.2% of GDP, compared to 93.7% a year before.

Trade and exchange rates

The UK had a trade deficit of £13.7 billion in the three months to March 2026, compared to a deficit of £11.5 billion in the three months to December 2025.

The current account deficit was £18.4 billion in Q4 2025 (2.4% of GDP), up from £10.7 billion in Q3 2025 (1.4% of GDP).

The value of sterling increased by 0.3% between March and April 2026, having decreased by 0.4% between February and March. Compared with a year ago, it is 0.1% higher.

Retail sales and consumer confidence

The volume of retail sales rose by 0.5% in the three months to April 2026 compared with the previous three months, and increased by 1.1% compared with the previous year.

GfK’s Consumer Confidence Index, which measures consumer attitudes, was at -23 in May 2026, up by two points from April.

House prices

House prices were broadly unchanged over the year to March 2026.

Household debt

Household debt stood at 117.5% of disposable income in Q4 2025. This ratio has generally been decreasing since 2022.

Economic indicators are quick-read summaries of the latest data focusing on different aspects of the UK economy. The full suite of indicators can be found on the main Economic Indicators page.