The UK economy is expected to have grown modestly again in the last three months of 2025 amid pressure from Budget uncertainty, according to economists.
The Office for National Statistics (ONS) will shed light on how the economy fared when it reveals the latest UK GDP (gross domestic product) data for December, and the final quarter as a whole, on Thursday February 12.
Economists have broadly predicted that the economy grew by 0.1% in the quarter.
However, some have suggested that it could tip slightly higher after stronger-than-expected activity in November and that clarity following the autumn Budget could have supported firms in the run-up to Christmas.
It comes after previous figures from the ONS showed that the economy grew by 0.1% in the three months to September.
This was followed by a 0.1% decline in October and then a 0.3% increase in November as the manufacturing sector was boosted by recovering production at Jaguar Land Rover after its major cyberattack.
December is however predicted to have seen no growth, according to estimates by Pantheon Macroeconomics.
A number of industry surveys also pointed towards weak data for December, such as the month’s construction industry PMI data which showed a continued deep decline across housing, commercial construction and civil engineering.
However, others suggested that improved certainty following the Budget may have helped drive a rise in spending, albeit still at modest levels.
Victoria Scholar, head of investment at Interactive Investor, said: “it is likely that economic activity picked up after the Budget once that cloud of uncertainty shifted to the rear view mirror in December.
“Plus, there could have been an improvement in the services sector with consumers spending on things like food and beverages, retail, and hotels around the festive season.”
The fourth quarter as a whole hampered by worries about the Budget has seen key indicators point towards an improvement in the key services sector, as consumer spending rises.
Robert Wood, chief UK economist at Pantheon Macroeconomics, said GDP growth “could tip to 0.2%” as a result, but held his prediction of 0.1%.
He added: “We think the broad thrust from activity in the services sub-sectors in December indicates that Budget uncertainty is already fading quickly.”
Nevertheless, the broader picture for UK growth is still muted.
The Bank of England said on Thursday that it believes the economy grew by 1.4% last year, reducing its previous estimate of 1.5%.
It also cut its growth forecast for 2026, from 1.2% to 0.9%, and for 2027, from 1.6% to 1.5%.
