Britain’s economy expanded modestly in the second quarter of 2026, with the Office for National Statistics reporting gross domestic product (GDP) rose by 0.4% between April and June. The figure marks a slowdown from the first quarter but reflects a better-than-expected uptick in June when businesses in the services sector reported stronger activity.
June surprise offsets wider pressures
The ONS said GDP increased by 0.3% month-on-month in June, exceeding market expectations for a flat reading. That gain followed a revised flat reading for May and a contraction in April, leaving growth across the quarter weaker than the start of the year but still positive.
Analysts highlighted two transient factors behind the June outperformance. Record temperatures during a summer heatwave encouraged spending in some leisure and hospitality areas, while the opening stages of the World Cup also supported trade for firms in the services sector.
“Growth slowed in the second quarter of the year, following a strong start to 2026, but remained relatively robust,”
“Services also drove growth in June, with some businesses reporting that good weather and sporting events may have had a positive impact that month,”
The remarks were made by Liz McKeown, director of economic statistics at the ONS.
Quarterly picture and short-term drivers
The quarterly sequence underlines a bumpy recovery. The ONS data showed:
- Q1 2026: GDP growth of 0.6%
- Q2 2026: GDP growth of 0.4%
- June 2026: month-on-month rise of 0.3%
- May 2026: revised to flat (0.0%)
- April 2026: contraction of 0.1%
| Month/Quarter | Change |
|---|---|
| Q1 2026 | +0.6% |
| Q2 2026 | +0.4% |
| June 2026 (m/m) | +0.3% |
| May 2026 (m/m) | 0.0% (revised) |
| April 2026 (m/m) | -0.1% |
While services made the largest contribution to the June rise, the ONS cautioned that some of the support was one-off or temporary. Weather-driven footfall and short-term boosts from major sporting events can lift activity in hospitality, retail and leisure without signalling a sustained acceleration in the wider economy.
Context: external risks and policy implications
The report comes against the backdrop of geopolitical and cost pressures. The ONS noted that the war in Iran has been one factor weighing on activity, though the June data suggest the immediate economic impact was partly mitigated by domestic factors. Officials and forecasters will now assess whether the pattern seen in June endures into the autumn — a period when energy costs, trade disruption and global growth trends could exert renewed influence.
For policymakers at the Bank of England and Treasury, the figures complicate the picture. A resilient services sector might reduce near-term pressure on borrowing costs, but the uneven monthly readings and reliance on transient supports underline that growth remains fragile and sensitive to external shocks and weather-related swings.
Market participants are likely to interpret the data with caution. The combination of slower quarterly growth compared with Q1 and a positive June reading suggests upside and downside risks: domestic demand has pockets of strength but is not uniformly robust across industries.
As the summer stimulus from weather and football fades, attention will turn to underlying indicators such as wages, business investment and consumer confidence to judge whether the economy is on a firmer footing or merely experiencing a temporary reprieve.
The ONS release provides a timely reminder that headline GDP movements often conceal a complex mix of temporary boosts and structural trends — and that interpreting short-term data requires careful weighing of competing influences.
