--- source: National Institute of Economic and Social Research (NIESR) url: https://niesr.ac.uk/publications/worrying-start-quarter document_type: html date_retrieved: 2026-03-15 period: February 2026 parent_publication: NIESR Monthly GDP Tracker indicators_covered: [NIESR Monthly GDP Tracker] --- # A Worrying Start to the Quarter - Home - Publications - A Worrying Start To The Quarter # A Worrying Start to the Quarter ### Downloads This content is restricted to corporate members, NiGEM subscribers and NIESR partners. ### Authors Fergus Jimenez-England ### Related Themes ## Main points - GDP stagnated in January. Peripheral sectors (construction and agriculture) reported positive monthly growth while services registered zero growth and production showed a second consecutive monthly contraction. - We continue to expect GDP growth of 0.3 per cent in the first quarter of 2026, driven by a recovery in activity in services and production. - We expect the impact of elevated energy prices on growth to be limited in the first quarter, but if energy prices remain elevated for the rest of the year it could reduce GDP growth by around 0.2 percentage points in 2026. “ GDP did not grow in January, despite surveys pointing to a revival in business sentiment early in the New Year. Services stagnated while production entered its second month of contraction. This is a worrying start to the quarter, given that the early-year improvement in business confidence is likely to be short-lived as global disruption linked to the Iran War hits the UK economy. We expect the impact on growth in the first quarter to be limited, but if energy prices remain elevated for the rest of the year it could reduce GDP growth by around 0.2 percentage points in 2026.” Fergus Jimenez-England, NIESR Associate Economist ## Related Blog Posts ## Inflation Expected to Fall Below Two Per Cent By April 2026 Huw Dixon 18 Feb 2026 6 min read ## Latest MRN Forecasts Point to Higher Than Expected Inflation for the Second Half of 2026 Huw Dixon ... 16 Feb 2026 5 min read ## What’s in Store for the UK Economy in 2026? 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