The UK economy grew by 0.7% in the third quarter of 2026, according to the Office for National Statistics’ first estimate. The expansion from July through September followed 0.5% growth in the second quarter, but the underlying figures show services driving activity while construction contracted.

Services led, while construction fell

Services output rose 0.9% over the quarter. Business-facing services increased 1.0%, compared with 0.5% growth in consumer-facing services. Production edged up 0.1%, while construction output declined 0.7%.

The split matters: a positive headline GDP figure does not mean every part of the economy expanded. The ONS counted increases in 13 of 20 subsectors, and construction remained a drag, including a 4.7% fall in private housing new work.

September returned to monthly growth

Monthly GDP increased 0.2% in September after no growth in August, which the ONS revised down from an earlier 0.1% estimate. July output had risen 0.4%. The quarterly reading smooths out those monthly changes, while the latest month suggests activity picked up modestly at the end of the quarter.

The first estimate can still change

This is an early reading based on information available so far. The ONS says the mean absolute revision between its first GDP estimate and the final estimate published three years later has been 0.27 percentage points since 2000. That history is a reminder that the 0.7% figure is a useful first measure, not a final account.

GDP per person also rose 0.7% in the quarter and was 1.7% higher than a year earlier, according to the same release. That adds a per-person measure to the headline total, though it does not describe how income or output is distributed among households.

What the figures mean for the outlook

The Bank of England’s November report had projected 0.7% third-quarter growth before the ONS release. It also said higher inflation and tighter financial conditions could weigh on activity in the final quarter and into 2027. Those are forecasts, and the new quarterly estimate does not settle how the economy will perform next.

The Bank raised its policy rate to 4% last week as inflation pressures persisted; see our earlier report on the Bank of England’s rate decision and inflation outlook.

Sources

Office for National Statistics, GDP first quarterly estimate: July to September 2026 · Reuters report on UK GDP via Investing.com · Bank of England, November 2026 Monetary Policy Report