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The UK economy expanded by 0.3% in November, exceeding expectations thanks to a revival in car manufacturing and an upswing in the services sector. According to the Office for National Statistics (ONS), this growth was primarily fueled by industrial production gains, notably as Jaguar Land Rover (JLR) resumed operations following a cyber-attack that had halted their output. The rise in services was also partly attributed to increased activities in accounting and tax consultancy, coinciding with the Budget announcement on 26 November. Analysts had anticipated a more modest 0.1% growth for the month.
In November, various businesses within construction, industrial production, and services reported to the ONS that they were adopting a cautious approach, holding off on decisions until after the autumn Budget. It is important to note that monthly GDP figures tend to be more volatile than the rolling three-month average, which provides a more stable indication of economic trends. When looking at the broader picture, the economy grew by 0.1% in the three months leading up to November compared to the previous quarter, as detailed by the ONS.
Economic experts responded to the latest data with cautious optimism. Yael Selfin, chief economist at KPMG UK, pointed out that the data reflected accelerated economic activity despite pre-Budget uncertainties. She noted, “Despite the relatively muted consumer sentiment so far and consumer-facing services output declining in November, there are some tentative signs of a pick-up in household spending.” Selfin further emphasized that with much of the uncertainty now behind businesses, growth momentum is expected to persist in the coming months. Similarly, Suren Thiru, economics director at the Institute of Chartered Accountants in England and Wales, described the November data as “unexpectedly upbeat,” suggesting that most sectors had appeared to overcome pre-Budget uncertainties. Thiru added, “November’s uptick means it’s inevitable that the UK economy grew modestly across the final quarter of 2025 with easing uncertainty post-Budget likely to have supported growth in December, despite the ‘super flu’ disrupting activity in sectors like education.”
Despite the overall positive headline figures, construction output declined by 1.3% in November and experienced “its largest three-monthly fall in nearly three years,” according to the ONS. Ruth Gregory, deputy chief economist at Capital Economics, attributed the drop mainly to “unseasonably wet weather” and predicted that the sector would likely bounce back in December. However, she commented that the rise in services during November mainly offset recent steep declines rather than signal a robust improvement in the economy, stating, “So we think November’s strength is more likely to be a rebound rather than a sign that the economy is fundamentally stronger than we thought.” Deutsche Bank’s chief UK economist, Sanjay Raja, also weighed in, suggesting that the data should temper expectations for a Bank of England interest rate cut in February. He said, “With the economy now on a firmer footing than expected the impetus to accelerate rate cuts is likely lower.” Part of the industrial recovery was driven by a 25.5% jump in motor vehicle output, led by Jaguar Land Rover’s staged resumption of production after its September shutdown caused by a cyber-attack.
From a governmental perspective, a Treasury spokesperson highlighted efforts to strengthen the economy by correcting years of underinvestment in infrastructure and advancing planning reform. While acknowledging ongoing challenges in controlling bills and inflation, the spokesperson affirmed the government’s commitment to easing the cost of living. In contrast, Shadow Chancellor Mel Stride critiqued the economic performance, asserting that growth remained stagnant. He remarked, “The chancellor promised growth as her number one mission, but a failure to grip the benefits bills – and instead putting up taxes – is weighing heavily on business and the economy.”
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