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*London, January 2025* — The International Monetary Fund (IMF) has upgraded its economic growth forecast for the United Kingdom in 2025, citing stronger-than-expected performance in the first quarter of the year. According to the latest World Economic Outlook Update, the UK is now on track to post the third-fastest growth among G7 economies next year, after a period of resilience and recovery.
UK Exceeds Growth Expectations in Q1 2025
The revised outlook comes on the heels of official data showing UK gross domestic product (GDP) grew by 0.7% in the first quarter of 2025—outpacing all other G7 countries during the same period. This robust growth marks a significant turnaround for the UK economy, which had previously been clouded by concerns over stagnation and persistent inflation.
The strong Q1 performance was highlighted in multiple reports, including coverage by [The Guardian](https://news.google.com/rss/articles/CBMilAFBVV95cUxPOGxLR2t1QUY4aEstTHRudnE5d080dlV2NU4xcVpMYTJtUkw0R3NxTHZxdTZhT001WFNzdGNFTzZtNk5iclVUVnNncllhV0ljWTVTeWVSU3VPOGxnSkpBaHdGZ282TjJEaUR1MklWbjNKWThVUnNlR2JsZFBZRjlmakZONGp0U0FjMFFjSjV3TDJ6SUMz?oc=5), which noted that the UK economy “defied gloomy warnings” by beating earlier forecasts and excelling in the G7 group.
IMF Revises UK 2025 Economic Growth
The IMF’s January 2025 update, titled “Global Growth: Divergent and Uncertain,” noted a global economic environment characterized by varying rates of progress across regions. However, it identified the UK as an outperformer, due in part to the surprise acceleration in economic activity at the start of the year.
According to a [Reuters](https://news.google.com/rss/articles/CBMingFBVV95cUxOenZxOUItXzcwZHZ5eFd4Z0VELUNhd2J3SE1LT0RMcW1ETUl3bnJXUEdOUEpRQlZfRjQtZk9KTmNWRTdCcjY4ZXBaWXNkSThtYldhUUdRWlZnNFdWaXRwX0NFNDY1cmtxcy1FQlFxRExidnlBTnVFMk5XZ3pwcG9hOXg2Yk1LYWw1TjZkMnZ5Qlk0dF9ZZ0RXc29yQ1RkUQ?oc=5) summary of the IMF report, the UK is now expected to achieve the third-strongest GDP growth in the G7 in 2025, behind only the United States and Canada. The IMF attributed this upward revision to the UK’s resilient consumer activity, improved business confidence, and early signs of inflation cooling.
Deloitte’s [Global Economic Outlook](https://news.google.com/rss/articles/CBMiigFBVV95cUxOd0dQOHJpTTRxcmx6RkVTZEstalhLYVYyYTZKMy0yRGFZOUNianVxamJVRDZVZFpzWEp2S08wTnRXbTdFQThxZ2ZabklUcGVYNmh0Mk5OQVhRV0swYjZFaUkxa3Foa3JRd3VCTmFBMFczMlJXdENxcnJsNEpsVTVscU5Yek1mYVppVFE?oc=5) for January 2025 also reinforced the notion of “divergent and uncertain” global growth, but pointed out that the UK’s improved outlook is notably aligned with its strong Q1 results.
Economic Drivers and Outlook
Analysts point to several factors supporting the UK’s improved growth trajectory. The 0.7% Q1 GDP expansion was led by both the services sector and solid consumer demand, according to reporting from [Times of India](https://news.google.com/rss/articles/CBMi_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?oc=5).
Looking forward, the IMF noted that risks remain in the global economy due to ongoing geopolitical developments and uncertainty in energy markets. However, the UK is now seen as relatively well-positioned to sustain its recovery and weather external shocks, given its current momentum.
Summary
The IMF’s upgraded forecast reflects growing confidence in the UK’s economic prospects for 2025. Following stronger-than-expected GDP growth in the opening months of the year, the UK has emerged as a leader among advanced economies, helping to counter prior expectations of prolonged stagnation. The outlook will be further clarified in future updates as more data on inflation and employment trends become available.
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