Key facts
- UK GDP grew 0.5% in Q2 2026, revised up from 0.4%.
- Household income per head rose 1.1% in the first half of 2026.
- Business investment increased 1.8% in Q2 2026.
- Sterling reached a six-week high against the euro.
The UK economy expanded by 0.5% in the second quarter of 2026, a faster pace than the initial estimate of 0.4%, according to revised data from the Office for National Statistics (ONS). This upward revision places the UK's growth rate on par with the US for the first half of the year. Household income per head also saw a stronger increase than previously reported, rising to 1.1% between January and June, with the savings rate climbing to 8.8%. Business investment showed resilience, growing by 1.8% in the second quarter and 5.2% year-on-year. Analysts suggested that confidence may have been boosted by the "Burnham bounce" following the Makerfield byelection. The ONS data indicated that the UK economy has remained resilient despite global conflicts and rising borrowing costs. The stronger economic performance has led to speculation that the Bank of England might consider higher interest rates to curb inflation, which remains above the 2% target at 3.1%.