The UK had the fastest-growing economy in the G7 in the first half of 2026, after the latest figures showed the economy yet again grew faster than expected.
The latest growth figures from the Office for National Statistics (ONS) showed the economy grew by 0.5% in April-June this year, up from the the previous estimate of 0.4%.
Coming off the back of 0.6% growth in Q1, the UK has managed to cement its position as the fastest growing advanced economy in the world.
The UK is ahead of every other G7 nation in terms of 2026 growth, with Canada, the US and Japan each seeing growth of 0.9% so far in the year.
The figures are good news for chancellor John Healey ahead of his budget in four weeks time, and mean that his predecessor Rachel Reeves handed over a slightly larger economy than previously recognised.
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The Q2 growth was driven by 0.6% growth in the services sector and 0.8% growth in the construction sector.
The surprising growth has resulted in government bonds rallying, with the yields on short and long-dated bonds are both falling, the Guardian reports.
There were other pieces of good economic news released on Wednesday as well. They were:
- A 1% increase in real household disposable income per head in April-June. This is an important measure of living standards, showing that people had more money left to spend, save, or invest after taxes and deductions.
- Jump in UK business investment, which went up by 1.8% in Q2 and is 5.2% higher than a year ago. This is thought to be driven by the AI boom.
- UK exports were stronger than first estimated, increasing by 2.8% in Q2, up from estimates of 0.5%.
The British economy continues to show impressive resilience in the face of higher energy prices caused by the Iran war and borrowing costs, although experts still predict things will slow towards the end of the year as these factors take hold.