Thu, 13 Nov 2025

Thu, 13 Nov 2025 Faisal Islam: Slow growth raises stakes even higher for the Budget

The Budget somehow has to provide certainty, boost consumer and business confidence, and fill a large fiscal gap.

* The UK economy grew by only 0.1% in the July-to-September quarter, below forecast and a decrease from earlier in the year.
* The economy actually contracted in September due to a cyber-attack on Jaguar Land Rover that disrupted car production.
* Momentum in the economy has slowed down, with consumer-facing services and business investment experiencing slowdowns.
* Higher employment costs and ongoing uncertainty are contributing to consumers' caution and low spending levels.
* Businesses have not yet invested heavily, partly due to concerns about tax changes.
* The Budget is expected to introduce a buffer against fiscal shocks and potential changes to how often the chancellor's borrowing rules are assessed.
* A further Bank of England rate cut next month seems likely, which could lead to lower fixed mortgage rates.
* Chancellor Rachel Reeves will use the growth figures to demand discipline over tricky Budget decisions from her backbenchers.
* The UK economy has not managed to break the trend of slow growth despite a strong first half of the year.
* The 26 November Budget is expected to provide certainty, boost consumer and business confidence, and fill a large fiscal gap.
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