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UK's GDP grows by just 0.1% in August: "We are sleep-walking into an economic disaster"

ended 16. October 2025

THE UK's GDP grew by just 0.1% in August with financial experts warning that “we are sleep-walking into an economic disaster".

Data published by the Office for National Statistics this morning showed that monthly Gross Domestic Product (GDP) is estimated to have grown by 0.1% in August 2025, following a fall of 0.1% in July 2025 (revised down from no growth) and growth of 0.4% in June 2025.

Real gross domestic product (GDP) grew by 0.3% in the three months to August 2025 compared with the three months to May 2025, a slight increase following growth of 0.2% in the three months to July 2025.

Services output grew by 0.4% in the three months to August 2025, while construction output increased by 0.3% and production output fell by 0.3% in the same timeframe.

Katy Eatenton, Mortgage & Protection Specialist at St Albans-based Lifetime Wealth Management, said the UK is “flatlining”.

She added: "The UK economy is in a state of total stasis. The marginal growth we saw in August was wiped out by July's downward revision. The net result is an economy crawling along with no zest and no energy. 

"And we have the Budget ahead, which has the potential to further impact business. We're in for an ominous fourth quarter."

Omer Mehmet, Managing Director at Welling-based Trinity Finance, said the figures are worrying.

He continued: "Growth of 0.1% is basically standing still — it’s treading water, not turning a corner. The economy feels flat on the ground because consumers are stretched, businesses are cautious, and government policy keeps changing direction. 

“The construction sector is the clearest warning sign: small gains one month, losses the next, with no momentum. What the UK needs now isn’t spin about green shoots, but real stability, investment and confidence so growth isn’t measured in decimal points.”

Riz Malik, Director at Southend-on-Sea-based R3 Wealth, said an “economic disaster” is coming.

He added: "UK plc is relying on hopes and prayers at the moment ahead of the winter Budget. We have high inflation, a weak labour market and GDP results that, if on a school report, would be annotated with ‘See me’. 

“We are sleep-walking into an economic disaster. The quickest way we can make money is to tax Emirates more to take advantage of all those who have had enough, packed their bags and flown out of this mess.”

Ranald Mitchell, Director at Norwich-based Charwin Mortgages, described it as “déjà vu”.

He continued: “So, the UK economy grew in August or at least until September’s revision says otherwise. We’ve seen this film before: a flicker of growth followed by a quiet downgrade the next month. 

"It’s starting to feel like statistical déjà vu. Beneath the headline, the story hasn’t changed, the economy’s jogging on the spot and it’s not a great read.”

Andrew Montlake, CEO at London-based Coreco, said the figures were having a negative effect on the housing market. 

He added: "This morning's data shows that the economy, if not quite flatlining, is stagnating. No doubt the government will seize on any growth being a positive, and there is good news on growth in construction and services, but everyone is waiting to see what happens in the November budget, and it is this that is slowing the housing market. 

"Whether this data, together with slowing wage growth and higher unemployment is enough to lead to a Bank of England rate cut remains to be seen."
 

6 responses from the Newspage community

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Riz Malik
Independent Financial Adviser at R3 Wealth
UK plc is relying on hopes and prayers at the moment ahead of the winter Budget. We have high inflation, a weak labour market and GDP results that, if on a school report, would be annotated with ‘See me’. We are sleep-walking into an economic disaster. The quickest way we can make money is to tax Emirates more to take advantage of all those who have had enough, packed their bags and flown out of this mess.
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Editor
Katy Eatenton
Mortgage & Protection Specialist at Eatenton Finance
The UK economy is in a state of total stasis. The marginal growth we saw in August was wiped out by July's downward revision. The net result is an economy crawling along with no zest and no energy. And we have the Budget ahead, which has the potential to further impact business. We're in for an ominous fourth quarter.
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Editor
Ranald Mitchell
Director at bad credit mortgage specialists Charwin Mortgages
So, the UK economy grew in August or at least until September’s revision says otherwise. We’ve seen this film before: a flicker of growth followed by a quiet downgrade the next month. It’s starting to feel like statistical déjà vu. Beneath the headline, the story hasn’t changed, the economy’s jogging on the spot and it’s not a great read.
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Editor
Andrew Montlake
CEO at Coreco
This mornings data shows that the economy, if not quite flatlining, is stagnating. No doubt the Government will seize on any growth being a positive, and there is good news on growth in construction and services, but everyone is waiting to see what happens in the November budget, and it is this that is slowing the housing market.
Whether this data, together with slowing wage growth and higher unemployment is enough to lead to a Bank of England rate cut remains to be seen.
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Scott Gallacher
Director at Rowley Turton
No doubt the Chancellor will focus on the 0.3% quarterly growth as a positive, but let’s be clear — even that’s well below what we need. Worse still, the last time the country saw any real growth was three months ago. The past two months have been stagnant, with no sign of the much-promised, and much-needed, recovery.

With no real growth, rising unemployment, and stubbornly high inflation, the country — and the government — is running out of time. And with the next Budget looming, it’s starting to look like it could be a disaster.
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Omer Mehmet
Managing Director at Trinity Finance
Growth of 0.1% is basically standing still — it’s treading water, not turning a corner. The economy feels flat on the ground because consumers are stretched, businesses are cautious, and government policy keeps changing direction. The construction sector is the clearest warning sign: small gains one month, losses the next, with no momentum. What the UK needs now isn’t spin about green shoots, but real stability, investment and confidence so growth isn’t measured in decimal points.