GDP data shows the UK economy flatlined in July and growth was just 0.2% in the month alone. The ONS said growth in the services and construction sectors in July was offset by a 0.9% fall in the production sector, which includes manufacturing.

Trade figures showed that the volume of goods exports bounced back in July, rising by 5.2% after a significant drop in June, with EU sales up by 1.4%, led by car exports, and non-EU exports up by 9.3%. 

UK exports in goods to the US rose by £0.8bn in July, a 20.5% rise month on month, but remain significantly below pre-April levels when most new tariffs were applied.

Cars, fuels and industrial goods saw big increases in sales. There was also an increase of 4.1% in the volume of imports from the EU and 3.7% from the rest of the world.  

However, services exports were unable to sustain recent stable growth with a drop in volumes of 0.4% during July, while services imports were flat. 

Responding to the GDP data, Stuart Morrison, research manager at BCC, said: 

“Today’s data shows the UK economy had a subdued summer, with limited growth in the three months to July, and 0% in the month alone.  

“The business landscape remains challenging, particularly for SMEs, with cost pressures impacting investment, recruitment and trade. While our latest economic forecast suggests growth of 1.3% this year, that’s largely down to stronger-than-expected activity in Q1, before the impact of national insurance and tariffs.  

“Inflation is proving stubborn, meaning for businesses struggling with the cost of borrowing, the pace of further interest rate cuts is likely to be slower than expected. 

“The Government has acknowledged it has asked a lot of business in the past year. Our message is now clear – there must be no more taxes on business in the Autumn Budget. The Chancellor must focus on unlocking growth and productivity through business. Our recent Blueprint for Growth contains practical ideas to get businesses investing, recruiting and trading.” 

Commenting on the latest ONS trade data, BCC head of trade policy, William Bain, said:  

“The first month of reduced automotive tariffs has had a positive effect on US exports alongside more certainty on the outlook for other manufactured goods sectors.  

“But far more work is needed on US tariffs. That means delivering the promised zero percent tariffs on steel and aluminium goods, long term certainty for pharmaceuticals, and securing lower levies on other goods if possible.  

“The performance of our trade in goods with the EU continued its recent upward trend but the UK-EU reset negotiations need to deliver quickly. Firms are clamouring for cuts to red tape and lower compliance costs.  

“There is also a warning in the data as services exports cooled off in July reflecting business concerns about wider economic headwinds. The government needs to focus on the fundamentals to boost UK trade. 

“That means lowering tariffs, removing regulatory barriers, boosting supply chain cooperation, and improving access to export support and finance. The faster, simpler and cheaper trade is for UK companies, the higher our exports will be.”