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UK economic forecast: June 2025

Martin Sartorius Principal Economist

CBI Principal Economist, Martin Sartorius, looks at the road ahead for the UK economy.

18 Jun 2025, 3 min read

UK outlook: muddling through

Our latest forecast expects that UK economic momentum will remain modest, with GDP growing by 1.2% in 2025 and 1.0% in 2026. Household spending is the main driver of growth over our forecast - supported by real incomes gains and lower interest rates - but higher labour costs and global economic uncertainty will weigh on business investment. The increase in employment costs following the Autumn Budget will lead to higher prices, subdued business investment, and

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