Britain's economy grew by 0.7% in the third quarter of 2026, its fastest quarterly pace in more than two years, according to official figures published on Thursday.

The Office for National Statistics (ONS) said gross domestic product (GDP) expanded by 0.7% between July and September, following growth of 0.5% in the second quarter. It was the strongest calendar-quarter growth since the first quarter of 2024 and matched the forecast in a Reuters poll of economists.

Compared with a year earlier, the economy was 1.9% larger, the strongest annual reading since the final quarter of 2024. Output per person rose by 0.7% in the quarter and stood 1.7% higher than a year ago.

Services drive the growth

Growth was driven almost entirely by the services sector, which grew by 0.9% over the quarter. ONS chief economist Grant Fitzner said the economy "grew robustly in the third quarter almost entirely due to strong and widespread growth in the services sector".

Computer programming and consultancy services were among the strongest performers, with the BBC reporting a 4.4% rise, reflecting the boom in artificial intelligence investment. Monthly GDP rose by 0.2% in September, after no growth in August.

What it means for the year ahead

The Bank of England now expects the economy to expand by 1.6% this year, stronger than the 1.2% forecast by the Office for Budget Responsibility after Chancellor John Healey's Budget on 28 October, which did not factor in some of the stronger recent data.

Economists cautioned that the figures are an early estimate and remain open to revision, and that growth could slow in the final quarter as higher energy bills squeeze household spending. The ONS publishes its next GDP estimate in December.

Sources: Office for National Statistics; Reuters.