12 November 2026
If you are covering the latest UK GDP figures from the Office for National Statistics, please find below a comment from Kit Rees, investment strategist at Quilter:
"The UK economy has well and truly confounded forecasts this year with strong growth over the third quarter. GDP is up 0.7% in the third quarter, thanks once again primarily to spending on artificial intelligence. This is in stark contrast to what had been predicted for this year and quells the UK’s recent habit of having strong growth in the first half of the year only.
“The interesting question now is how long that resilience can last. The UK has continued to grow despite a decidedly unhelpful backdrop, but there is a danger the headline number flatters an economy that is beginning to lose momentum underneath. That said, growth for September itself was a little hotter than expected with growth coming in at 0.2%, although August was revised down to no growth.
“But while growth remains robust, if unspectacular by historic standards, higher employment costs and rising energy prices are hitting at the same time as cost-of-living pressures weigh down on demand. This is expected to be the case for the rest of this year and into next, unless the geopolitical situation somehow transforms into a more positive backdrop. That is likely to weigh on the economy into next year.
“While the rhetoric has been dialled back of late and energy prices have fallen, the war in the Middle East has had enough of an impact that it continues to hamper future activity. With inflation persistently high and the Bank of England raising interest rates in a bid to get it under control, the outlook for the coming months is not great. The Bank of England is therefore in an unenviable position. The economy continues to show resilience but there are fears it will lose momentum just as energy-driven inflation is keeping pressure on interest rates. A de-escalation in the Middle East would help considerably, but until then the Bank has little room for manoeuvre and thus further rises will be expected.”
