{"id":6466,"date":"2025-07-11T11:51:33","date_gmt":"2025-07-11T11:51:33","guid":{"rendered":"https:\/\/otetmarkets.com\/blog\/?p=6466"},"modified":"2025-07-11T11:51:34","modified_gmt":"2025-07-11T11:51:34","slug":"uk-economy-may-2025","status":"publish","type":"post","link":"https:\/\/otetmarkets.com\/blog\/news\/uk-economy-may-2025\/","title":{"rendered":"UK Economy Shrinks 0.1% in May 2025, Raising Risk of Q2 Contraction"},"content":{"rendered":"\n<p>The <strong>UK economy contracted 0.1% month-over-month in May 2025<\/strong>, following a sharper 0.3% decline in April, according to official data released by the Office for National Statistics (ONS). The back-to-back drops fell short of market expectations for a modest 0.1% expansion and now <strong>raise concerns of a broader economic contraction in Q2<\/strong> for the UK economy May 2025.<\/p>\n\n\n\n<figure class=\"wp-block-video\">\n  <a href=\"https:\/\/otetmarkets.com\/prblog\" target=\"_blank\">\n    <video height=\"500\" style=\"aspect-ratio: 1312 \/ 500;\" width=\"1312\" autoplay=\"\" loop=\"\" muted=\"\" playsinline=\"\">\n      <source src=\"https:\/\/otetmarkets.com\/blog\/wp-content\/uploads\/2025\/04\/Otet-Banner-en-2.mp4\" type=\"video\/mp4\">\n      Your browser does not support the video tag.\n    <\/video>\n  <\/a>\n<\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-key-takeaways-from-uk-may-gdp-report\"><br><strong>Key Takeaways from UK May GDP Report<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>GDP fell <strong>0.1% MoM<\/strong>, following April\u2019s 0.3% contraction.<\/li>\n\n\n\n<li><strong>Production output shrank 0.9%<\/strong>, led by weakness in manufacturing.<\/li>\n\n\n\n<li>Services grew 0.1%, aided by a 2% rise in IT and communications during the challenging period for the UK economy May 2025.<\/li>\n\n\n\n<li>Construction output declined 0.6%, reversing April\u2019s growth.<\/li>\n\n\n\n<li>Three-month GDP (Mar\u2013May) still shows <strong>0.5% growth<\/strong>.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-sector-breakdown-what-s-dragging-growth\"><br><strong>Sector Breakdown: What\u2019s Dragging Growth<\/strong><\/h3>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"482\" src=\"https:\/\/otetmarkets.com\/blog\/wp-content\/uploads\/2025\/07\/slider-photo-28-1024x482.webp\" alt=\"UK economy May 2025\" class=\"wp-image-6468\" srcset=\"https:\/\/otetmarkets.com\/blog\/wp-content\/uploads\/2025\/07\/slider-photo-28-1024x482.webp 1024w, https:\/\/otetmarkets.com\/blog\/wp-content\/uploads\/2025\/07\/slider-photo-28-300x141.webp 300w, https:\/\/otetmarkets.com\/blog\/wp-content\/uploads\/2025\/07\/slider-photo-28-768x361.webp 768w, https:\/\/otetmarkets.com\/blog\/wp-content\/uploads\/2025\/07\/slider-photo-28.webp 1312w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>The decline was primarily driven by a <strong>0.9% drop in production output<\/strong>, its second consecutive fall. The <strong>manufacturing sector plunged 1%<\/strong>, with steep declines in <strong>basic pharmaceuticals (-4.2%)<\/strong> and <strong>transport equipment (-1.3%). <\/strong>These factors impact the broader picture of the UK economy May 2025. Mining and quarrying also dipped by <strong>3.2%<\/strong>.<\/p>\n\n\n\n<p>While industrial activity suffered, utilities showed modest growth: water supply and waste management rose <strong>0.8%<\/strong>, and electricity, gas, steam, and air conditioning increased by <strong>0.3%<\/strong>.<\/p>\n\n\n\n<p>In construction, output fell by <strong>0.6%<\/strong>, following a gain of 0.8% in April\u2014adding further weight to the downside pressure.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p><strong>Read More: <a href=\"https:\/\/otetmarkets.com\/blog\/news\/uk-manufacturing-pmi-april-2025\/\" target=\"_blank\" rel=\"noreferrer noopener\">UK Manufacturing PMI Falls Sharply in April<\/a><\/strong><\/p>\n<\/blockquote>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-services-offer-some-relief\"><br><strong>Services Offer Some Relief \ud83d\udcca<\/strong><\/h2>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><thead><tr><th>Sector<\/th><th>May 2025 Change<\/th><th>April 2025 Change<\/th><th>Notable Details<\/th><\/tr><\/thead><tbody><tr><td>Services Sector<\/td><td>+0.1%<\/td><td>-0.3%<\/td><td>Boosted by 2% rise in IT and communication<\/td><\/tr><tr><td>Manufacturing<\/td><td>-1.0%<\/td><td>-0.6%<\/td><td>Major declines in pharma (-4.2%) and transport (-1.3%)<\/td><\/tr><tr><td>Production Output<\/td><td>-0.9%<\/td><td>-0.6%<\/td><td>Consecutive monthly falls<\/td><\/tr><tr><td>Mining and Quarrying<\/td><td>-3.2%<\/td><td>&#8211;<\/td><td>Further drag on industrial production<\/td><\/tr><tr><td>Construction Output<\/td><td>-0.6%<\/td><td>+0.8%<\/td><td>Volatile activity over past two months<\/td><\/tr><tr><td>3-Month GDP Growth (Mar\u2013May)<\/td><td>+0.5%<\/td><td>\u2014<\/td><td>Still showing moderate resilience<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-risk-of-quarterly-contraction-looms\"><br><strong>Risk of Quarterly Contraction Looms<\/strong><\/h2>\n\n\n\n<p>Although the 3-month rolling GDP grew <strong>0.5%<\/strong>, the monthly contractions in both April and May increase the likelihood of a <strong>Q2 contraction<\/strong>, especially if June data doesn\u2019t rebound significantly. Weakness in industrial output and construction contrasts with modest gains in services.<\/p>\n\n\n\n<p>Economists warn that prolonged declines in manufacturing and global demand uncertainties could weigh on future momentum within the UK economy May 2025. However, the IT and professional services sector remains a bright spot.<\/p>\n\n\n\n<p><strong>\ud83d\udcac Do you think the UK economy can bounce back in June? Share your views below and follow us for more market updates! \ud83d\udcc9<\/strong><\/p>\n\n\n\n<p><a href=\"https:\/\/tradingeconomics.com\/united-kingdom\/monthly-gdp-mom\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The UK economy contracted 0.1% month-over-month in May 2025, following a sharper 0.3% decline in April, according to official data released by the Office for National Statistics (ONS). The back-to-back drops fell short of market expectations for a modest 0.1% expansion and now raise concerns of a broader economic contraction in Q2 for the UK [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":6469,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[24,2],"tags":[37],"class_list":["post-6466","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-global-economy-news","category-news","tag-financialnews"],"_links":{"self":[{"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/posts\/6466","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/comments?post=6466"}],"version-history":[{"count":2,"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/posts\/6466\/revisions"}],"predecessor-version":[{"id":6471,"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/posts\/6466\/revisions\/6471"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/media\/6469"}],"wp:attachment":[{"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/media?parent=6466"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/categories?post=6466"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/otetmarkets.com\/blog\/wp-json\/wp\/v2\/tags?post=6466"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}