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What caused the slowdown in UK GDP growth this quarter?
The UK’s GDP growth slowed to 0.2% in Q3, mainly due to a decline in manufacturing output. A cyber attack on Jaguar Land Rover disrupted production, contributing significantly to the slowdown. Revised figures also show weaker performance in previous months, reflecting broader economic challenges.
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How did the cyber attack on Jaguar Land Rover impact the economy?
The cyber attack on Jaguar Land Rover led to factory shutdowns and reduced vehicle production. This disruption affected the manufacturing sector, which is a key part of the UK economy, and contributed to the overall slowdown in economic growth during the third quarter.
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Is the UK economy heading for a recession?
While growth has slowed, experts are cautious about predicting a full recession. The Bank of England expects flatlining growth in late 2025, and although household incomes are falling, the UK remains one of the fastest-growing G7 economies. However, continued challenges could increase recession risks.
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What are experts saying about the economic outlook for 2026?
Economists are generally cautious about 2026, citing sluggish growth and ongoing uncertainties. The decline in household income, increased taxes, and reduced savings suggest consumers will be cautious, and the economy may continue to face headwinds despite some resilience.
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Why did household income fall in 2025?
Household income declined sharply due to increased taxes and reduced savings. These factors have led to cautious consumer spending, which can further slow economic growth. The combination of higher taxes and lower income levels is a key concern for the UK economy moving forward.