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The UK economy contracted by 0.1% MoM in January, missing the expected 0.1% growth, while YoY GDP rose 1.0%, below forecasts of 1.2%. The 3-month GDP change came in at 0.2%, slightly weaker than expected. Meanwhile, the trade deficit widened to £16.8B, with the non-EU trade gap at £6.1B, highlighting persistent external imbalances.

The S&P Global Composite PMI remained unchanged at 50.5, in line with expectations but slightly below the previous 50.6, indicating stable but modest economic growth. Meanwhile, the S&P Global Services PMI came in at 51.0, up from the previous 50.8, but missing the expected 51.1, signaling continued expansion in the services sector.

The UK's S&P Global Manufacturing PMI for February came in at 46.9, lower than the previous 48.3, and missing the 46.4 estimates, indicating continued contraction in the sector.

The Nationwide House Price Index (HPI) rose 0.4% MoM in February, exceeding the forecasted 0.2% and accelerating from the previous month's 0.1% increase. On a yearly basis, house prices grew 3.9% YoY, slightly above expectations of 3.4%, though slowing from the 4.1% recorded in January. The data suggests continued resilience in the UK housing market despite broader economic uncertainties.

The UK PMI data for February 2025 reveals stable economic conditions, with the S&P Global Composite PMI meeting the 50.5 estimates, but slightly less than the previous month, indicating balanced overall economic activity. The Manufacturing PMI fell to 46.4 from 48.3 in January, highlighting continued contraction in the manufacturing sector, although the decline was smaller than expected. On the other hand, the Services PMI increased slightly to 51.1 from 50.8, indicating moderate expansion in the services sector. While the services sector continues to show growth, manufacturing remains under pressure, reflecting a mixed economic outlook for the UK.

Retail sales in the UK showed strong resilience in January, with Retail Sales (MoM) rising 1.7%, significantly above expectations of 0.4% and recovering from December’s -0.6% decline. On a year-over-year basis, sales increased 1.0%, surpassing the forecast of 0.6% but lower than the previous 2.8% growth.

Core Retail Sales (excluding fuel) also performed well, growing 2.1% (MoM), beating the expected 0.9%, while YoY core sales rose 1.2%, ahead of forecasts. This suggests stronger consumer spending momentum.

In the public sector, Net Borrowing stood at -£15.44B, reflecting a budget surplus, though lower than the forecasted -£20.10B. Meanwhile, the Net Cash Requirement fell sharply to -£22.484B, indicating reduced borrowing needs compared to the previous month’s £20.154B.

The UK’s GfK Consumer Confidence index improved to -20 in February, beating expectations of -22 and rising from the previous month’s -22. This slight increase suggests a modest recovery in consumer sentiment, potentially driven by stabilizing economic conditions or easing inflationary pressures. However, confidence remains negative, reflecting ongoing concerns about the broader economic outlook.

The UK labor market displayed strength in December and January, with employment rising by 107K in the three months to December, a sharp increase from the previous 35K. The unemployment rate held steady at 4.4%, slightly below the expected 4.5%. However, January's Claimant Count Change surged to 22.0K, more than double the 10.0K forecast, reversing December's -15.1K decline. Meanwhile, wage growth accelerated, with the Average Earnings Index, including bonuses, reaching 6.0% in December, exceeding both the 5.9% estimate and the previous 5.5%, highlighting persistent wage pressures in the economy.

The UK’s industrial and manufacturing sectors showed signs of improvement in December 2024, despite ongoing year-over-year contractions. Industrial production rose by 0.5% month-over-month, exceeding the expected 0.2% gain and rebounding from the previous -0.5% decline. However, year-over-year industrial output remained negative at -1.9%, though slightly better than the anticipated -2.1% drop.

Similarly, manufacturing production increased by 0.7% month-over-month, outperforming the expected stagnation (0.0%) and rebounding from a 0.3% decline in the prior month. Yet, on a yearly basis, manufacturing output declined by -1.4%, a smaller contraction than the forecasted -1.9%.

The data suggests a short-term recovery in industrial activity, but persistent year-over-year declines indicate ongoing challenges, likely driven by weak demand, supply chain constraints, or higher input costs.

The UK economy posted slight growth in Q4 2024, avoiding contraction. Quarter-over-quarter GDP rose by 0.1%, outperforming the expected -0.1% decline and the previous quarter’s stagnation. Year-over-year GDP grew by 1.4%, surpassing forecasts of 1.1% and the previous 1.0% expansion. December’s monthly GDP increased by 0.4%, well above the 0.1% forecast, contributing to a 0.1% gain in the three-month rolling GDP measure, reversing the prior -0.1% decline.

The trade balance improved, with the overall trade deficit narrowing to £17.45B, better than the expected £18.60B shortfall. The non-EU trade deficit also declined to £6.10B, improving from the previous £7.19B deficit. The data suggests resilience in the UK economy despite ongoing economic challenges, with positive momentum in growth and trade balance improvements.

UK business investment contracted sharply in Q4 2024, highlighting economic challenges. Year-over-year, investment fell by 0.7%, a stark contrast to the previous 4.4% growth. Quarter-over-quarter, investment dropped by 3.2%, significantly worse than the expected -0.4% decline and reversing the prior 1.9% expansion. The sharp downturn suggests heightened business uncertainty, potentially driven by economic slowdown concerns, higher borrowing costs, or subdued corporate confidence.

The BRC Retail Sales Monitor for January 2025 showed a 2.5% year-over-year increase, exceeding the expected 1.1% but slightly lower than the previous month's 3.1% growth. The data suggests that consumer spending remained resilient despite economic uncertainties, reflecting steady retail demand. However, the slowdown compared to the previous month may indicate moderating momentum in the sector.