Britain's Economic Stagnation: Factors and Future Prospects

In a significant update on its economic health, Britain's economy recorded zero monthly growth in July 2025, driven by a substantial drop in manufacturing output, which fell by 1.3%, particularly in the computers, electronics, and pharmaceuticals sectors. This aligns with economists' expectations of a sluggish start to the latter half of the year.

The services sector, which forms a larger part of the economy, posted a marginal 0.1% growth, slightly exceeding forecasts. However, concerns loom as inflation and rising job losses threaten economic stability. Economic expert Suren Thiru indicated a possible restrained period ahead, despite predictions of a boost from warm weather conditions.

The probability of the Bank of England cutting rates further seems slim, given the upward trajectory of inflation. Despite a robust economic performance in the first half of 2025, bolstered by increased government spending and pre-tariff export activity, economists warn of slowed growth due to global trade tensions and domestic challenges within the labor market.

(With inputs from agencies.)