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Economics

NatWest UK Regional Growth Tracker report for June 2025

Positive end to second quarter as business activity grows across most UK nations and regions in June

  • East of England, South West and London the main growth drivers at end of Q2
  • Northern Ireland outperforms on employment front
  • Rates of output price inflation ease across the UK

The Tracker – which surveyed businesses operating in the manufacturing and services sectors across 12 regions of the country – showed business activity growth broaden from six nations and regions in May to eight in June, which was the most since September last year. The East of England recorded the fastest rate of expansion, the quickest it has seen for more than three years, followed by the South West and London. Business activity was unchanged in the North West and came close to stabilising in both the East Midlands and Yorkshire & Humber, while Northern Ireland saw a minor setback following growth in May.

 

Sebastian Burnside, NatWest Chief Economist, commented: "It was a positive end to the second quarter, with most UK nations and regions back in growth territory. Even where business activity dipped in June, with the rates of decline being only modest and the performances better than seen on average over the first half of the year, those areas are still in what we dub 'recovery' territory. "The same is true for underlying demand. New business either rose or was on a more stable footing compared to earlier in the year. "The labour market is the main weak spot at the moment, as the combination of wages pressures and underutilised capacity encourages firms to look for productivity gains where possible. "Encouragingly, cost inflation has come down from the highs seen in the spring, dropping even further in June across most parts of the UK. Businesses in all areas have been able to make smaller and smaller price increases of their own in last couple of months, relieving some of the pressure on demand."

 
 
Please see the regional reports in full:

 

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