UK Economy Grew 0.1% in May Despite Iran War Impact 2026

The UK economy grew 0.1% in May despite the impact of the Iran war on energy costs, according to official figures from the Office for National Statistics. This modest rebound follows a 0.1% decline in April, showing resilience amid global tensions.

GDP Growth Details and Sector Performance

The ONS reported that services output rose 0.3% in May, driven by a 5.1% surge in scientific research and development. However, this was partly offset by a 0.5% decline in production (including manufacturing) and a 0.8% fall in construction. Over the three months to May, GDP growth reached 0.7%, a slight slowdown from 0.8% in the three months to April.

Impact of Iran War on UK Economy

The Middle East conflict has raised energy prices and shipping costs, creating uncertainty for UK firms. The British Chambers of Commerce emphasized the urgent need to support businesses facing rising costs. Analysts noted that while the economy showed resilience, the Iran war suppressed activity in key sectors like construction and industrial production.

Comparison Table: Monthly GDP Growth by Sector

Key Takeaways from May GDP Data

• UK economy grew 0.1% in May, matching economists' forecasts.
• Services sector led growth, while production and construction declined.
• Iran war continues to impact energy costs and business confidence.
• Three-month GDP growth slowed to 0.7% from 0.8%.
• Chancellor Rachel Reeves likely to cite data as evidence of economic plan success.

Expert Reactions and Outlook

Liz McKeown, ONS director of economic statistics, noted that the economy recorded robust growth over three months but with a weaker recent picture. Suren Thiru of ICAEW called the rebound “dishearteningly weak” due to the Iran conflict. The British Chambers of Commerce urged government action to help firms with rising energy and shipping costs.

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