Goldman Sachs: UK GDP - FJElite

UK monthly GDP rose 0.1% in July, beating expectations for a slight contraction, as production output increased 0.8%, led by manufacturing. Around half of the manufacturing gain came from pharmaceuticals, a volatile sector, although transport equipment and other subsectors also contributed. Services output was flat, with gains in wholesale and retail trade and professional services offset by weaker administrative and support activities.

Construction output fell 0.2%, marking a fourth consecutive monthly decline, driven by reduced private housing work. Some of the pharmaceutical-led manufacturing strength may reverse in the next release, but the overall data points to stronger near-term momentum than previously expected.

The Q3 GDP tracking estimate has been raised to 0.7% quarter-on-quarter from 0.5%, lifting the 2026 Q4/Q4 growth forecast to 2.1% from 1.9%. Growth is still expected to moderate in Q4 as consumer spending slows.