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![\"Rachel](\"https:\/\/www.europesays.com\/uk\/wp-content\/uploads\/2026\/01\/Rachel-Reeves.jpg\")
\t\tRachel Reeves has overseen low growth in the UK economy over recent months.\t<\/p>\n
The UK economy grew more than expected in November last year but remained \u201cfundamentally weak\u201d, official data has shown, reflecting businesses\u2019 nerves about Rachel Reeves\u2019 Budget measures.\u00a0<\/p>\n
New Office for National Statistics (ONS)<\/a> figures showed growth in the UK economy inching up.<\/p>\n Business analysts warned over several months that pre-Budget speculation had dampened spending and investment levels.\u00a0<\/p>\n The figures will also pile pressure on Reeves and the rest of the Labour government, with economic growth being the party\u2019s central mission.\u00a0<\/p>\n A Bloomberg poll<\/a> of economists predicted zero growth earlier this week before the prediction was revised up to 0.1 per cent growth.<\/p>\n Over a three-month period, ONS researchers said the UK economy grew 0.3 per cent.\u00a0<\/p>\n \u201cThe economy grew slightly in the latest three months, led by growth in the services sector, which performed better in November following a weak October,\u201d said Liz McKeown, director of economic statistics at the ONS. <\/p>\n Disappointing figures for November came in construction, which suffered a decline in output of 1.3 per cent over the month. <\/p>\n The data body is expected to offer an estimate for economic growth over the calendar year when December figures are published next month.\u00a0<\/p>\n Thomas Pugh, chief economist at RSM UK, said the economy \u201cdid little more than stagnate\u201d in the final three months of last year and that there was \u201climited room for further rebounds\u201d.<\/p>\n He said: \u201cNovember\u2019s unexpectedly strong rebound was boosted by some one-off factors, which won\u2019t be repeated in December.\u201d<\/p>\n Ruth Gregory, deputy chief UK economist at Capital Economics, said the rise in output in accounting and IT \u201cdid little more than reverse the big declines in the past few months\u201d.<\/p>\n \t\t\t\t\tRead more<\/p>\n \t\t\tFTSE 100 Live: Stocks fall as oil takes hit; YouTube, BBC strike deal<\/a><\/p>\n She added: \u201cWe think November\u2019s strength is more likely to be a rebound rather than a sign that the economy is fundamentally stronger than we thought.\u201d<\/p>\n UK economy \u2018scraping along the bottom\u2019<\/p>\n The UK economy grew at a faster pace in the earlier parts of the year as finance chiefs rushed to invest in goods and services to get ahead of expected tariffs from President Trump and higher tax levels from April.\u00a0<\/p>\n The ONS has said that growth in the first quarter of 2025 was 0.7 per cent before dropping to 0.2 per cent and 0.1 per cent in the second and third quarters of the year.\u00a0<\/p>\n A Treasury spokesperson said: \u201cTo make the economy work for working people, we are reversing years of underinvestment by protecting record infrastructure investment, driving through major planning reform, backing expansion at Heathrow and Gatwick, delivering Northern Powerhouse Rail and getting Sizewell C built.\u201d<\/p>\n Shadow business secretary Andrew Griffith said the UK was \u201cscraping along the bottom\u201d on growth while Martin Beck, the chief economist at WPI Strategy who served as a Treasury analyst, said the rise helped overcome two consecutive months of decline.<\/p>\n \u201cWith GDP appearing to have expanded only marginally in the fourth quarter of last year, unfavourable base effects will mechanically depress calendar-year growth,\u201d Beck said.<\/p>\n \u201cFiscal policy will also be a significant drag: tax rises announced by both the current government and its predecessor mean the UK faces the largest discretionary fiscal tightening in the G7 this year, according to the IMF.\u201d<\/p>\n UK economy \u2018hindered by public sector\u2019<\/p>\n Economists have pencilled in lower growth over the upcoming year<\/a> than in 2025, with forecasts among City banks and consultancies ranging between 0.7 per cent and 1.4 per cent for the full year.\u00a0<\/p>\n Some forecasters believe falling interest rates could give companies and consumers some much-needed relief although business leaders have also warned that higher growth is set to be driven by government expenditure.\u00a0<\/p>\n The Confederation of British Industry<\/a>\u2019s chief economist Louise Hellem said a growth upgrade written in by the industry group should be interpreted as \u201ccautious optimism\u201d rather than \u201ccause of celebration\u201d.\u00a0<\/p>\n Hellem warned that private sector growth was being held back by \u201cunderlying challenges\u201d in heavy red tape<\/a>, high taxation and soaring energy prices while Panmure Liberum\u2019s Simon French has warned that the public sector could be \u201ccrowding out\u201d growth among private firms.\u00a0<\/p>\n The government has also pivoted its communications focus to the \u201ccost of living\u201d over economic growth, highlighting changes on inflation and extra welfare support for some large families as evidence of its work in easing price pressures on Britons.\u00a0<\/p>\n \t\t\t\t\tRead more<\/p>\n