UK economy grows 0.7% in third quarter as AI investment helps
Growth accelerated despite pressure from energy prices and borrowing costs, but early official figures and warnings of a slowdown leave the strength of the recovery uncertain.
By Hushread Stories, from 9 outlets · First published 12 Nov 2026
In brief
- The UK economy grew by 0.7% in the third quarter, matching expectations and accelerating from the previous quarter.
- The quarterly growth rate increased from 0.5%, reaching its fastest pace in more than two years.
- Early official figures showed an investment boost from AI, while separate coverage highlighted spending on defence.
- GDP also rose by 0.2% in September, adding a positive monthly reading to the quarterly figures.
- Reports still warn of a slowdown, with energy prices, borrowing costs and living costs weighing on the outlook.
Timeline · 5 moments
PM welcomes the stronger quarterly economic growth figures
The Independent ↗Growth shows resilience despite energy and borrowing pressures
Financial Times World ↗ONS also reports September GDP rose by 0.2%
Top Stories ↗Coverage highlights defence spending alongside the AI investment drive
Yahoo! UK News ↗Early figures show growth boost from AI investment
Sky News ↗How it started
The UK economy entered the third quarter after growth of 0.5% in the previous quarter. Analysts expected that pace to rise to 0.7%, according to investingLive.
Investment was a central part of the story. A preview published by Yahoo! UK News on November 12 pointed to spending on AI and defence as helping counter a slowdown linked to the cost of living.
How it unfolded
On November 11, Sky News reported that early official figures showed third-quarter growth of 0.7%, confirming a boost from AI investment. Its report also warned that a slowdown loomed.
On November 12, CNBC International reported the same quarterly figure, saying it matched estimates. The result was an acceleration rather than an unexpected surge.
There was also growth at the end of the quarter. Top Stories reported that the Office for National Statistics put September's month-on-month GDP increase at 0.2%.
Hereford Times described the quarterly expansion as the fastest in more than two years. The Independent reported that the PM called the data "welcome news".
Where it stands
The figures show an economy growing faster despite financial pressure. Financial Times World highlighted its resilience in the face of surging energy prices and rising borrowing costs.
But these are preliminary figures, not a final assessment. The stronger quarter sits alongside the slowdown warning reported by Sky News, leaving a gap between the latest measured performance and the outlook.
What to watch
The central question is whether investment can keep supporting growth as households and businesses face continued cost pressures. The AI boost reported by Sky News and the AI and defence spending highlighted by Yahoo! UK News help explain the stronger quarter, but do not establish how long that momentum will last.
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