Recent data revealed that the U.K. economy experienced a significant contraction in April as a result of global trade tariffs and domestic tax increases taking effect. The Office for National Statistics reported that the economy shrank by 0.3% month-on-month in April, following a growth of 0.2% in March, surpassing economists' expectations of a 0.1% decline.

The decline in April coincided with U.S. President Donald Trump's announcement of global trade tariffs, leading to widespread business uncertainty. Industrial production and services output notably decreased in April, while construction output saw growth. The ONS highlighted the impact of Trump's tariffs on U.K. exports, with a significant drop in goods exports to the United States following the introduction of tariffs.

Despite maintaining a relatively balanced trading relationship with the U.S. in terms of goods exchange, the U.K. was subjected to a 10% "reciprocal tariff" by Trump. In contrast, the EU faced a 20% tariff on exports to the U.S. The U.K. has since secured a trade deal with the U.S., making it the first country to do so as trade negotiations continue with other nations.