By Dayo Ade Olusola | 10 July 2025
The UK economy shrank for the second consecutive month in May, with fresh data from the Office for National Statistics (ONS) indicating continued strain across key sectors despite a pause in U.S. tariff escalation.
According to the ONS, gross domestic product (GDP) fell by 0.1% in May. While the services sector managed modest growth of 0.1%, both production and construction posted significant declines, down by 0.9% and 0.6% respectively.
The figures come after April’s more severe contraction of 0.3%, a slump largely attributed to heightened financial uncertainty surrounding trade tensions and a raft of domestic cost increases.
April had seen a surge in business and household bills, with national insurance contributions, the national minimum wage, and council tax all rising. Increases in car tax, energy, water, and broadband charges further contributed to the economic slowdown, placing added pressure on consumer spending and business operations.
Despite easing international trade tensions following a temporary pause in the U.S. tariffs introduced under President Donald Trump, UK industry has continued to falter. The sustained weakness in manufacturing and construction suggests broader structural challenges that may hinder short-term recovery.
Analysts warn that without targeted intervention to support struggling sectors, the UK may face ongoing stagnation through the second half of 2025.
Editing by M10News Business Desk | Contact: business@m10news.com
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