UK economy grows 0.7% in third quarter on AI investment

Summarised from 9 outlets · 12 reports · Updated 12 Nov, 14:21 · Archive

The UK economy grew by 0.7 per cent between July and September, the fastest rate in more than two years.

The UK economy grew by 0.7 per cent between July and September, the Office for National Statistics said, marking the fastest quarterly growth rate in more than two years. This represented an acceleration from 0.5 per cent growth in the second quarter.

The growth was driven almost entirely by the services sector, which expanded by 0.9 per cent. Within services, computer programming and consultancy surged by 4.4 per cent, the fastest rate for computer programming in three years and the largest driver of GDP growth across 2026. The ONS said many businesses reporting the largest increases in turnover were involved in activities related to artificial intelligence and cloud computing, reflecting a wider AI spending boom as many businesses prioritised investing in their technology systems.

The expansion was particularly notable given headwinds facing the broader economy. Higher oil and gas prices, following the re-escalation of the Middle East conflict, had been expected to restrict growth. Petrol prices rose above £1.70 a litre and diesel towards an average of £2 a litre, whilst natural gas prices reached about three times the level in February.

Growth in September alone was 0.2 per cent, exceeding economist expectations of zero growth for the month. The Guardian reports that the ONS revised down August growth from 0.1 per cent to zero.

Prime Minister Andy Burnham said the figures were 'welcome news'. 'Despite a year where events around the world have pushed up costs here at home, our economy is growing, bringing hope for the future,' he said. Chancellor John Healey said: 'The Middle East conflict has hit growth worldwide, yet Britain is showing standout resilience. Our UK economy is growing at the fastest rate in almost ten years, outside the pandemic.'

The Bank of England voted earlier in November to raise interest rates by a quarter of a percentage point to 4 per cent to cool inflationary pressures. Experts warned that strong economic growth made another rate rise more likely. The Office for Budget Responsibility, which had expected growth of 1.2 per cent for the full year at the time of the budget in November, saw its forecast already appearing out of date as growth continued to exceed expectations.

How it is being reported

• Faisal Islam: Why the UK economy is surprisingly resilientThe UK is seeing impressive growth, but will it last?BBC News · 12 Nov, 13:27
• UK economy grows at fastest quarterly rate in more than two yearsGross domestic product (GDP) increased by 0.7% in the third quarter, between July and September.Evening Standard · 12 Nov, 09:10
• UK economy grows at fastest quarterly rate in more than two yearsGross domestic product (GDP) increased by 0.7% in the third quarter, between July and September.Evening Standard · 12 Nov, 08:09
• Boost For Andy Burnham As UK Economy Grows At Fastest Rate For More Than 2 YearsThe UK economy grew at its fastest rate for more than two years over the 12 months to September, according to new figures. A 0.7% expansion was also recorded between just July and September, all of which was described as “welcome news” by Andy Burnham. “Despite a year where events around the world have pushed up costs here at home, our economy is growing, bringing hope for the future,” the prime minister said. Economic growth has clearly accelerated from the second quarter of the year, between April and June, when gross domestic product (GDP) rose by 0.5%. The figures are particularly…HuffPost UK · 12 Nov, 08:02
• UK economy grows at fastest quarterly rate in more than two yearsGross domestic product (GDP) increased by 0.7% in the third quarter, between July and September.Evening Standard · 12 Nov, 07:54
• UK economy 'defies doomsayers' after GDP grows over summer driven by boom in roll-out of AIGrowth of artificial intelligence helps power stronger-than-forecast growth in the UK economy in the third quarter of this year, with other sectors doing well including car dealers, accountancy and recruitment agenciesThe Mirror · 12 Nov, 07:51
• UK economy grows at fastest rate for more than two yearsThe UK economy grew by 0.7% in the three months to September, according to official figures.BBC Business · 12 Nov, 07:16
• UK economy grows by 0.7 per cent as spending on AI and defence staves off cost-of-living slowdownGrowth picked up to 0.7 per cent for the third quarter - between July and September - following growth of 0.5 per cent in the second quarter, the Office for National Statistics said today.Daily Mail · 12 Nov, 07:12
• UK economy grows by 0.7% in third quarter - fastest rate in two years in boost for BurnhamThe UK economy grew by 0.7% between July and September, the Office for National Statistics said.The Independent · 12 Nov, 07:10
• UK economy grows 0.7 per cent as AI boom lifts business investmentThe UK economy grew by 0.7 per cent between July and September, official data has shown, as spending held up in the face of a spike in energy prices caused by the Iran war. The Office for National Statistics said GDP expanded far above previous expectations in the third quarter of 2026, with economists revising [...]City AM · 12 Nov, 07:09
• UK economy grows by 0.7% in third quarter despite high oil pricesONS also says GDP rose 0.2% month on month in September, in a boost to the chancellor, John Healey The UK economy grew by 0.7% in the third quarter, as expected by City analysts, confirming that consumers and businesses remained resilient despite high oil and gas prices. The Office for National Statistics said a jump in the cost of petrol, diesel and natural gas prices following the re-escalation of the conflict in the Middle East played an important role in restricting economic growth in the three months to the end of September. Continue reading...Guardian World · 12 Nov, 07:07
• Economy grows 0.7% in third quarter but slowdown loomsThe UK economy grew 0.7% in the third quarter of the year, according to early official figures confirming a boost from artificial intelligence (AI) investment.Sky News Business · 11 Nov, 10:26

In this story: UK · Office for National Statistics · Andy Burnham · John Healey · Bank of England · Middle East · Office for Budget Responsibility

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