UK gross domestic product (GDP) increased by 0.1% month-on-month in December, following growth of 0.2% in November, the Office for National Statistics (ONS) has revealed.

While this figure was boosted by 0.3% growth in the services division, it was partially offset by 0.9% and 0.5% in production and construction respectively.

In the three months to December, real GDP also increased by 0.1%. This compares to a drop of 0.1% in the three months to November, which was revised down from growth on 0.1%.

In the final quarter of 2025, services output showed no growth, after also showing no increase in the three months to November.

However, production and construction output increased by 1.2% and 2.1% respectively. This follows output shrinks of 0.1% and 0.9% respectively in the previous month.

Personal finance analyst at Bestinvest, Alice Haine, said that the latest data in the final quarter of 2025 reflects the uncertainty that weighed on the UK economy in the run-up to the Autumn Budget.

She stated: "Speculation around possible tax rises was rife, prompting many businesses and households to pause spending until they had greater clarity on the Government’s plans.

"Growth in December was largely driven by an uplift in the services sector, perhaps as a clearer sense of the Government’s approach to business and personal taxes encouraged firms and consumers to relax their budgets in the run-up to Christmas. Worryingly though, services showed no growth across the final quarter of 2025, while production grew 1.2% and construction recorded its worst performance in more than four years.

"The lacklustre GDP data is unlikely to offer Chancellor Rachel Reeves much relief as she navigates the first quarter of this year after a challenging 2025."

Investment strategist at Quilter, Lindsay James, added that while the “picture is rather bleak”, some optimism is warranted if inflation falls.

She concluded: "Should it come back down to the Bank of England’s 2% target, the door could open to more significant rate cuts later in the year.

"We should now be reaching a place where peak uncertainty is behind us, and businesses are better able to plan for the post budget and post trade deal world. However, the well flagged leadership challenge – which headlines would have us believe is fast becoming a case of when rather than if – risks derailing that. Should that materialise and we see a lurch to the left, it could result in higher spending, higher taxes and even weaker growth. Only time will tell how it plays out."

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