Guardian

UK economy shrinks by 0.3% as as exports hit by Trump trade war

Independent

Blow for Rachel Reeves after UK economy shrinks by more than expected

Metaculus

Keir Starmer

Office for Budget Responsibility

Ben Riley-Smith

Goldman Sachs

KPMG

Naomi Smith

Robert Colvile

UK Trade & Business Commission

Sharon Graham

"Today's #GDP growth figures are still a long way from @Keir_Starmer's target of 2.5% and it is far from clear that we are heading in the right direction."

"The OBR will drop the forecast for 2025/26 growth from 2% to around 1%."

"Labour are promising to be the fastest-growing country in the G7. And our growth forecast is 2% or less every single year of this parliament? Yeah, good luck with that."

"The economy is expected to grow by just over 1 per cent this year, rising to 2 per cent in 2025."

Research shows that "deep alignment with the EU on goods and services will deliver 2.2% economic growth to the UK."

"Closer ties with the EU could deliver growth of up to 2.2%. Clawing back up to half the damage caused by Brexit."

"Certainly, yes [when pressed on whether he was seeking to achieve growth of 2.5 per cent]."

Will the UK Economy Grow By 2% GDP In a Year Under Labour?

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The U.K. economy contracted by 0.3 percent in April 2025, marking the steepest monthly decline since October 2023 and exceeding economists' predictions of a 0.1 percent fall, according to the Office for National Statistics (ONS).

BBC News

The U.K. economy contracted by 0.3 percent in April 2025, marking the steepest monthly decline since October 2023 and exceeding economists' predictions of a 0.1 percent fall, according to the Office for National Statistics (ONS).

Services output fell by 0.4 percent in April 2025 following growth of 0.4 percent in March, with legal activities declining 10.2 percent, and real estate activities dropping 6.5 percent as April saw an increase in the Stamp Duty Land Tax rate.

GOV.UK

Services output fell by 0.4 percent in April 2025 following growth of 0.4 percent in March, with legal activities declining 10.2 percent, and real estate activities dropping 6.5 percent as April saw an increase in the Stamp Duty Land Tax rate.

Employer National Insurance contributions increased from 13.8 percent to 15 percent in April, with the threshold reduced from £9,100 to £5,000 annually, while businesses also faced higher minimum wages and business rates during the same period.

Employer National Insurance contributions increased from 13.8 percent to 15 percent in April, with the threshold reduced from £9,100 to £5,000 annually, while businesses also faced higher minimum wages and business rates during the same period.

Manufacturing output decreased by 0.9 percent in April, with car production falling 9.5 percent after the introduction of 25 percent U.S. tariffs on vehicle imports, while the construction sector grew 0.9 percent for its third consecutive monthly increase.

Commonslibrary

Manufacturing output decreased by 0.9 percent in April, with car production falling 9.5 percent after the introduction of 25 percent U.S. tariffs on vehicle imports, while the construction sector grew 0.9 percent for its third consecutive monthly increase.

ONS data also released Thursday shows goods exports to the U.S. fell by £2.0 billion in April 2025, representing the largest monthly fall on record since data collection began in January 1997, following President Trump's implementation of tariffs on U.K. imports.

ONS data also released Thursday shows goods exports to the U.S. fell by £2.0 billion in April 2025, representing the largest monthly fall on record since data collection began in January 1997, following President Trump's implementation of tariffs on U.K. imports.

Despite the monthly contraction, the U.K. economy grew by 0.7 percent in the three months to April 2025 compared to the three months to January. As of Q1 2025, the U.K. economy has grown 4.1 percent compared to pre-pandemic levels (Q4 2019), below the Eurozone (5.3 percent), Canada (8.8 percent), and the U.S. (12.1 percent).

Despite the monthly contraction, the U.K. economy grew by 0.7 percent in the three months to April 2025 compared to the three months to January. As of Q1 2025, the U.K. economy has grown 4.1 percent compared to pre-pandemic levels (Q4 2019), below the Eurozone (5.3 percent), Canada (8.8 percent), and the U.S. (12.1 percent).

Guardian #0

Independent #0

Metaculus #0

BBC News #

ONS #

GOV.UK #

Independent #

Commonslibrary #

The economic contraction reflects the damaging impact of Labour's tax-and-spend policies hitting businesses just as they face global uncertainty. Rachel Reeves' National Insurance raid on employers, combined with higher minimum wages and business rates, has created a perfect storm that's forcing companies to cut jobs and cancel investments. The timing couldn't be worse, with over 250,000 jobs already lost since the autumn budget and businesses struggling under the weight of spiraling costs.

The economic contraction reflects the damaging impact of Labour's tax-and-spend policies hitting businesses just as they face global uncertainty. Rachel Reeves' National Insurance raid on employers, combined with higher minimum wages and business rates, has created a perfect storm that's forcing companies to cut jobs and cancel investments. The timing couldn't be worse, with over 250,000 jobs already lost since the autumn budget and businesses struggling under the weight of spiraling costs.

Daily Mail

Daily Mail #

Rachel Reeves' spending splurge plans are ALREADY in chaos after GDP fell 0.3% in April - fuelling fears she WILL have to hike taxes

Guardian #

April's economic decline was driven by external factors beyond government control, particularly Trump's tariff war that devastated UK exports to America and created widespread business uncertainty. The stamp duty changes also artificially inflated March activity as buyers rushed to complete purchases, making April's figures appear worse than the underlying trend. The quarterly growth of 0.7% shows the economy's fundamental resilience despite these temporary headwinds.

April's economic decline was driven by external factors beyond government control, particularly Trump's tariff war that devastated UK exports to America and created widespread business uncertainty. The stamp duty changes also artificially inflated March activity as buyers rushed to complete purchases, making April's figures appear worse than the underlying trend. The quarterly growth of 0.7% shows the economy's fundamental resilience despite these temporary headwinds.

UK economy shrank in April as tax rises and US tariffs kicked in

UK Economy Shrinks 0.3% in April Amid Tax Hikes, US Tariffs

Economic conditions & trends

Governance

Politics

United Kingdom

April’s economic dip was disappointing, but not wholly unexpected. Monthly GDP data is volatile and the impact of Trump's tariffs have now been felt. What matters more is long-term decision-making, and here the government remains undeterred. Reeves's commitment to capital investment has laid the groundwork for stronger, fairer growth in the long-term for the U.K.

April’s economic dip was disappointing, but not wholly unexpected. Monthly GDP data is volatile and the impact of Trump's tariffs have now been felt. What matters more is long-term decision-making, and here the government remains undeterred. Reeves's commitment to capital investment has laid the groundwork for stronger, fairer growth in the long-term for the U.K.

ING Think

UK starts the second quarter on the back foot

The i Paper

Rachel Reeves was right - now it's time to give her some credit

April's figures are a reality check for Reeves after Q1's rush to beat the Trump tariffs. Reeves continues to throw borrowed billions at unsustainable ideological pursuits allowed only by her meddling with the fiscal rules. As job losses mount and growth vanishes, her refusal to face hard choices or reform welfare risks tipping the U.K. into long-term stagnation and a fiscal crisis.

April's figures are a reality check for Reeves after Q1's rush to beat the Trump tariffs. Reeves continues to throw borrowed billions at unsustainable ideological pursuits allowed only by her meddling with the fiscal rules. As job losses mount and growth vanishes, her refusal to face hard choices or reform welfare risks tipping the U.K. into long-term stagnation and a fiscal crisis.

The Telegraph

It is now too late for Britain to avoid financial Armageddon

julianHjessop

There is a 16% chance that the U.K. will achieve an annual GDP growth rate of 2.5% over the current parliamentary term, according to the Metaculus prediction community.

There is a 16% chance that the U.K. will achieve an annual GDP growth rate of 2.5% over the current parliamentary term, according to the Metaculus prediction community.

UK Economy Shrinks 0.3% in April Amid Tax Hikes, US Tariffs

UK Economy Shrinks 0.3% in April Amid Tax Hikes, US Tariffs

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UK Economy Shrinks 0.3% in April Amid Tax Hikes, US Tariffs

UK Economy Shrinks 0.3% in April Amid Tax Hikes, US Tariffs

The Spin

Metaculus Prediction

The Controversies

Graham

Riley-Smith

Colvile

Responsibility

Commission

Smith

Starmer

Articles on this story

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