Chancellor John Healey has said Britain’s economy is showing resilience despite global uncertainty, after new figures confirmed the UK recorded the fastest economic growth in the G7 during the first half of the year.
New data from the Office for National Statistics shows the economy grew by 0.4% in the second quarter of 2026, following growth of 0.6% in the first quarter. Taken together, the UK expanded by around 1% during the first half of the year, the strongest performance among G7 economies.
Healey said:
“Our growth, though still fragile, was the fastest in the G7 in the first half of the year.”
He added that Britain was continuing to demonstrate resilience despite the impact of conflict in the Middle East on energy prices and household costs.
Economy grows 0.4% in July
The latest figures offer further encouragement, with the economy growing by 0.4% in July, significantly stronger than economists had expected.
Annual GDP growth reached 1.6%, its fastest pace for around 18 months. Services were a major driver of the improvement, with technology-related industries among those performing strongly.
The figures came despite substantial international headwinds, including higher energy prices and continuing uncertainty caused by conflict in the Middle East.
Healey said:
“While the conflict in the Middle East is affecting costs at home, Britain’s economy is demonstrating resilience.”
Labour links growth to devolution and business
The Chancellor said the Government’s next task was to turn national economic growth into better opportunities and living standards across every region.
“We’re shifting power to local areas and backing business to drive growth.”
Earlier this week, Healey set out a wider growth programme aimed at increasing investment, supporting British businesses and handing more economic powers to local leaders.
Measures announced include a £150 million British Business Bank fund for high-growth firms in the North, the new Northern 500 initiative and reforms aimed at removing delays that prevent businesses from investing and expanding.
‘Growth in every postcode’
Healey has said his ambition is to deliver growth across the whole country rather than allowing economic opportunity to remain concentrated in a small number of places.
His economic strategy sits alongside Prime Minister Andy Burnham’s wider push for devolution, with mayors and local leaders being given greater power to attract investment and shape their regional economies.
The Chancellor has also pledged to maintain fiscal discipline, arguing that sustainable growth and sound public finances must go together.
There remain significant challenges. Higher oil prices are adding to inflationary pressure, while borrowing costs have risen sharply amid international uncertainty. Economists have also cautioned that some of the strong first-half performance may prove temporary.
Nevertheless, the latest figures provide Labour with evidence that the economy has continued to expand in difficult conditions.
For Healey, the priority now is to build on that resilience — backing businesses, devolving economic power and ensuring Britain’s improving growth translates into jobs, investment and higher living standards across the country.
