IoD press release Economy surpasses expectations in February
Commenting on ONS data that showed GDP rose by 0.5% in February 2025, following no growth in GDP in January (revised from -0.1%), Anna Leach, Chief Economist at the Institute of Directors, said:
“February’s GDP growth was much greater than expected and the strongest in 11 months. It was good to see pretty broad-based strength, with an acceleration in retail sales and travel services pointing to signs that consumer spending might be lifting, and a pickup in manufacturing, including car sales. However, overall car sales remain 10% down on the year amidst a range of pressures – both global and domestic.
“US actions in recent days have shaken the foundations of global trade. The UK has trodden a careful path through this turbulence, pursuing ongoing trade negotiations with the US, building relationships with other trade partners, and collecting information on the UK’s exposure to US imports ahead of any retaliatory action. This measured response is the right one. Unfortunately, global policy uncertainty seems likely to remain high for the foreseeable future, and this will slow decision-making and raise financing costs for business, above and beyond the direct impact of tariffs. In this environment, it is even more important for the government to pursue stronger growth via as many channels as possible. The UK’s industrial and trade strategies, de-regulation, and unleashing the benefits of AI, can all help accelerate growth in key sectors and markets, while a pragmatic approach to the net zero transition will alleviate pressure on sectors such as automotive.”
