UK economy grows despite global uncertainty

Britain’s economy expanded by 0.1 percent in May, a modest rise that surprised many analysts who had expected a further slowdown after a 0.1 percent contraction in April.

Growth stalls amid lingering uncertainty

The Office for National Statistics reported the gain in the month‑to‑month change of gross domestic product, noting that the increase was driven largely by a rebound in services output.

Financial planning firm Finli Group announced that it added £269 million in assets under management during the second quarter of 2026, after completing seven acquisitions. The total acquisitions for the first half of the year now stand at 13, bringing the firm’s overall assets to more than £8.7 billion.

While the economy’s slight growth offers a brief reprieve, the broader outlook remains clouded by political turbulence. A recent biannual client sentiment survey from IG found that 62 percent of retail investors now cite domestic political uncertainty as a primary risk to their portfolios, up 11 percentage points from six months earlier.

Investor behavior shifts as uncertainty grows

The IG study also revealed that nearly one in four investors have altered their asset allocation in response to the political climate. Of those who rebalanced, 42 percent moved funds from UK equities into overseas markets, and 19 percent increased their cash holdings.

More than three quarters of respondents expect ongoing political uncertainty to either depress UK stock market performance or heighten volatility in the months ahead.

In a separate development, Sarasin & Partners named two new partners. Tom Lindsey, who joined from the firm’s charities team, and Ben Gilbert, who transitioned from the private‑client division, will now oversee multi‑asset portfolios and the model portfolio service respectively.

Meanwhile, LV= reported a record year for protection claims, paying nearly £152 million in 2025—an increase of almost £15 million compared with the previous year. The insurer highlighted its Doctor Services, which provide policyholders and families with access to six medical support services from the start of coverage.

For the average person, the combination of modest economic growth and heightened political risk may mean keeping a closer eye on where savings are parked. With more investors moving money abroad and holding cash, the pressure on domestic markets could linger, potentially slowing the pace of future growth.

Financial adviser Laura Suter of AJ Bell noted that frozen tax thresholds are squeezing household incomes, yet they remain a significant source of revenue for the Treasury. “The government can’t afford to lose that stream,” she said, reflecting concerns about fiscal stability.

In the health sector, Vitality launched a new podcast series called The Good Health Edit, featuring GP and broadcaster Dr Punam Krishan. The fortnightly episodes aim to discuss common health topics, from nutrition to mental wellbeing, and are available on YouTube.

Overall, the UK’s economic performance in May shows a fragile rebound that may not be enough to shift monetary policy. Investors appear to be reacting cautiously, adjusting portfolios amid ongoing political and fiscal challenges.