UK economy shrinks by 0.3% as as exports hit by Trump trade war
Guardian1 day
UK Economy Shrinks 0.3% in April Amid Tax Hikes, US Tariffs
Above: Skyline of the City of London on May 9, 2025 in London, U.K. Image copyright: Mike Kemp/In Pictures/Getty Images
The Spin
Pro-government narrative
April’s economic dip was disappointing, but not wholly unexpected. Monthly GDP data is volatile and the impact of Trump's tariffs have now been felt. What matters more is long-term decision-making, and here the government remains undeterred. Reeves's commitment to capital investment has laid the groundwork for stronger, fairer growth in the long-term for the U.K.
Opposition narrative
April's figures are a reality check for Reeves after Q1's rush to beat the Trump tariffs. Reeves continues to throw borrowed billions at unsustainable ideological pursuits, allowed only by her meddling with the fiscal rules. As job losses mount and growth vanishes, her refusal to face hard choices or reform welfare risks tipping the U.K. into long-term stagnation and a fiscal crisis.