UK economy shrinks 0.3% in April

(Sharecast News) - The UK economy contracted more than expected in April as higher taxes and Trump's tariffs took their toll, according to figures released on Thursday by the Office for National Statistics. The economy shrank 0.3% following 0.2% growth in March. Economists were expecting a contraction of 0.1%.

The data showed that monthly services output fell 0.4% in April following 0.4% growth the month before, and was the largest contributor to the fall in monthly GDP.

Production output shrank 0.6% in April following a 0.7% contraction in March, while construction output grew 0.9% following growth of 0.5% in March.

ONS director of economic statistics Liz McKeown said: "The economy contracted in April, with services and manufacturing both falling. However, over the last three months as a whole GDP still grew, with signs that some activity may have been brought forward from April to earlier in the year.

"Both legal and real estate firms fared badly in April, following a sharp increase in house sales in March when buyers rushed to complete purchases ahead of changes to stamp duty. Car manufacturing also performed poorly after growing in the first quarter of the year."

McKeown said that after increasing for each of the four preceding months, April saw the largest monthly fall on record in goods exports to the US, with falls across most types of goods following the recent introduction of tariffs.