Britain’s economy grew by 0.4 per cent in the second quarter of 2026, slowing from the 0.6 per cent expansion recorded in the first quarter, according to the Office for National Statistics.

The ONS said the economy remained relatively robust despite domestic political uncertainty and the economic impact of the US-Iran war.

The slowdown came amid a period of political upheaval in the UK. Former Prime Minister Keir Starmer resigned in late June and was replaced about a month later by Andy Burnham, while the Labour government faced growing pressure from the right-wing Reform UK party.

Rising energy prices linked to the conflict in the Middle East have also added pressure to households and businesses, with inflation already elevated.

Britain’s new Finance Minister, John Healey, acknowledged concerns over the effect of the conflict on the cost of living and businesses, saying the government was focused on making the economy more resilient.

The services sector remained the main driver of growth, expanding by 0.5 per cent during the quarter. Construction also recorded growth, while production remained flat.

The economy expanded by 0.3 per cent in June, following no growth in May and a slight contraction in April.

The ONS attributed part of June’s stronger performance to increased business activity linked to the recent FIFA World Cup, particularly in alcohol manufacturing, wholesale, food and beverage services, publishing, television production and advertising.

However, the British Chambers of Commerce warned that the headline growth figures masked continuing cost pressures affecting businesses and called for the government’s October budget to deliver measures that would boost trade, investment and productivity.

The Bank of England has also warned that UK inflation could rise further as the Middle East conflict keeps energy prices elevated.