UK economic growth in November provided a welcome easing of pressure but stopped short of signalling a decisive shift in momentum, according to Professor Emeritus Joe Nellis, economic adviser at MHA, the accountancy and advisory firm.
"While November’s increase in GDP of 0.3% is welcome, the recovery remains fragile, narrowly based, and vulnerable to shifts in household and business sentiment, as well as the impact of the Chancellor’s Autumn Budget, " said Proessor Nellis.
"Growth in November was supported by pockets of resilience in services and selective strength in consumer-facing industries during the early festive period, as Christmas sales continue to be spread across a longer period. However, output across construction remains constrained, reflecting a cautious investment climate and persistent cost pressures.
"The UK economy appears to be stable and performing as well as or better than the majority of its G7 peers. With inflation moving closer to the Bank of England’s 2% target, we can expect another interest rate cut in the Spring, providing a much-needed stimulus to business confidence and a boost to corporate investment.
"Yet, while the UK may be moving away from stagnation, the underlying picture is far from settled. Inflation has eased, but real disposable incomes remain stretched, and productivity gains are limited. Expected interest rate cuts are only possible because the economy is not growing at too fast a pace and overheating.
Professor Emeritus Joe Nellis, economic adviser at MHA
"Following two months of contraction, a firmer GDP reading offers some short-term support to the government’s finances. Improved activity typically helps reinforce tax receipts from both labour markets and consumer spending. UK 10-year bond yields are now at their lowest level since December 2024, lowering the cost of servicing the debt. However, the government’s fiscal position remains tight.
"For businesses, November’s data provide some encouragement but not certainty. Firms continue to operate in an environment defined by high input costs, subdued demand, and elevated financing rates. Many are delaying investment decisions until there is clearer visibility of momentum in the real-economy and further reductions to interest rates.
"Today’s figures outperformed expectation and is a sign of life in the economy as we head into 2026. The pace of expansion will depend on further disinflation, looser monetary conditions, and a revival in business confidence."
Among its 30 locations, accountancy and advisory firm MHA has offices in Aberdeen and Edinburgh.
MHA is the UK member firm of Baker Tilly International and an AIM listed company. Ranked as the 11th largest accountancy group in the UK and Republic of Ireland, MHA reported a turnover of £224m (FY2024/2025), with over 2,300 staff, 150 partners.
For more information, visit https://www.mha.co.uk/