Closing post
Time to recap…
The UK economy grew at the fastest pace in a year between January and March, defying warnings of a collapse in activity, as businesses scrambled to invest and export before Donald Trump’s sweeping tariffs.
The Office for National Statistics said gross domestic product (GDP) rose by 0.7% in the quarter, beating City predictions of a 0.6% rise and continuing an expansion after growth of 0.1% in the final three months of last year.
The strong growth means the UK was almost certainly the fastest-growing member of the G7 group of advanced economies in the first quarter of the year.
The UK now has the fastest growth in the G7 – our Plan for Change in action.
— Keir Starmer (@Keir_Starmer) May 15, 2025
We've had four interest rate cuts since July and wages are rising faster than prices.
But I know the Tory cost of living crisis isn’t over – we will go further and faster to deliver for working people.
Driven by Britain’s dominant services sector, the latest snapshot will bolster the chancellor, Rachel Reeves, after business leaders had warned earlier this year that her tax policies would hit jobs and growth.
However, economists cautioned that growth later in the year was likely to be much weaker, amid concerns over the fallout from Trump’s erratic tariff plans after his “liberation day” announcement on 2 April.
The faster-than-expected UK growth in the first three months of the year is welcome news for a Labour government desperate to make good on its promise of kickstarting the economy.
Under siege from Nigel Farage’s Reform and under pressure from its own MPs over tax and spend, Labour will now point to the 0.7% increase in GDP over the first quarter as evidence the hard yards are starting to pay off.
Less encouragingly… there has been a jump in the number of direct debit defaults on energy and water bills….
…and a rise in UK mortgage repossessions.
In America, the threat of a recession hasn’t totally abated, according to the boss of JP Morgan.
“If there’s a recession, I don’t know how big it’ll be or how long it will last.
“Hopefully we’ll avoid it, but I wouldn’t take it off the table at this point.”
Donald Trump has warned Apple to row back on its plans to expand manufacturing in India
Walmart is planning to pass on the impact of new US tariffs to its customers, by raising prices.
And growth in oil demand is set to slow this year, the IEA has warned.
$JPM CEO JAMIE DIMON WARNS A U.S. RECESSION IS STILL POSSIBLE -- EVEN AS POLYMARKET ODDS DROP TO JUST 39% FOR 2025 😳 pic.twitter.com/G1CeTh5Wmm
— Shay Boloor (@StockSavvyShay) May 15, 2025
