UK economy grows 0.5% in February as services and factories rebound

Britain’s economy grew 0.5% in February, a stronger-than-expected rebound that suggested the country entered the spring with more momentum than many economists had feared. The Office for National Statistics said the monthly rise, released on 16 April 2026, was the biggest since January 2024 and followed a revised 0.1% increase in January.

The February figure was well ahead of the 0.1% monthly gain economists had expected, and GDP also rose 0.5% in the three months to February compared with the three months to November. That left the economy on firmer ground just before the Iran war began to feed through into markets, energy prices and business confidence.

Services, which make up the biggest part of the economy, rose 0.5% in February and did much of the lifting. The ONS said wholesaling, market research, hospitality and publishing all helped drive the expansion, while car production recovered from the effects of the autumn cyber incident. Production output also rose 0.5% in February and was up 1.2% over the three months to February. Construction rose 1.0% over the month, but still fell 2.0% across the quarter, showing that the recovery was uneven even in a better-than-expected reading.

Grant Fitzner, the ONS chief economist, said growth increased further in the three months to February, led by broad-based gains across services. The statistics agency also said it remained confident in its figures and seasonal adjustment processes, despite suspicions from some economists about recent seasonal patterns.

The data offered a useful benchmark for Chancellor Rachel Reeves and the Bank of England: the economy was expanding before the geopolitical shock, but the margin was not large. The International Monetary Fund has already cut its 2026 UK growth forecast to 0.8% from 1.3% and said Britain faces the biggest downgrade in the G7, linking the weaker outlook to the Iran war and higher energy costs. Economists have warned that a fresh jump in fuel bills could push inflation higher and weaken the labour market, quickly eroding the resilience shown in February.

For now, the figures show an economy that was still growing, with services and factories both rebounding. The harder question is how much of that momentum survives a conflict that has already raised the risk of another energy shock.