U.K. Economy Unexpectedly Contracts, Posing New Challenge to Government

The U.K. economy unexpectedly shrank in the first month of the year, the latest frustration for a relatively new government that has pledged to bring an end to a decade-and-a-half of stagnation.

Gross domestic product was 0.1% lower in January than in the final month of 2024, the Office for National Statistics said Friday, weaker than the 0.1% rise expected by a consensus of economists. It also marks a slowdown from the 0.4% recorded in December.

Despite the economy’s continued struggles, the Bank of England is expected to leave its key interest rate unchanged when it meets next week. The annual rate of inflation jumped to 3% in January and is set to rise further over coming months.

Weaker-than-expected growth means tax revenues are likely to be lower than the government anticipated, adding to the challenges facing Treasury Chief Rachel Reeves as she prepares to announce new budget plans later this month.

“The U.K. economy is stuck in the slow lane,” Scott Gardner, investment strategist at digital wealth manager Nutmeg, said. “This latest data just goes to show the mountain to climb for Chancellor [Reeves] to reclaim momentum and get Britain growing at pace in 2025.”

There appears to be little hope of respite soon. U.K. firms’ activity expectations for this year declined in February, in contrast with a mild improvement globally, according to an S&P survey published this week.

Private-sector businesses are set to shrink their workforces as profit outlooks darken, with S&P’s index of employment expectations turning negative for the first time in more than 15 years outside the pandemic lockdowns of mid-2020.

“It is also the only time aside from the pandemic where firms have forecast simultaneous cuts to employment, capital expenditure and research and development, demonstrating the gloomy outlook for U.K. business investment in 2025,” David Owen , senior economist at S&P Global Market Intelligence, said.

The BOE last month halved its forecast for economic growth in 2025 to 0.75%. However, since it currently expects 0.1% growth for the first quarter, the January data suggests the U.K. might have an even weaker start to the year.

The government’s fiscal watchdog is also set to cut its own forecasts later this month. Britain’s economy grew 0.9% in 2024 as a whole, compared to 2.8% in the U.S.

Adding uncertainty to the forecasts are new tariffs that the Trump administration could impose on both the U.K. and neighboring European Union, a move that would curtail growth further.

“The U.K.’s economic performance may have been similarly downbeat in February, with any boost from consumer spending amid strong wage growth and lower interest rates weakened by the brake on business activity from this torrent of global uncertainty,” Suren Thiru , economics director at the Institute of Chartered Accountants in England and Wales, said.

The economy was dragged in January by a 1.1% drop in manufacturing output, a sector that could bear the brunt of any trade barriers.

President Trump has already imposed 25% tariffs on all steel and aluminum imports, including those from the U.K. Exports of steel from the U.K. to the U.S. in 2024 was worth around 370 billion pounds, or around $480 billion, according to trade association U.K. Steel.

Prime Minister Keir Starmer on Wednesday said that the U.K. will “keep all options on the table” in response to the tariffs.

It’s go time for the highest-stakes mission at NASA in more than 50 years.

On April 1, the agency is set to launch four astronauts around the moon, the deepest human spaceflight since the final Apollo lunar landing in 1972.

The launch window for Artemis II , as the mission is called, opens at 6:24 p.m. ET.

National Aeronautics and Space Administration teams have been preparing the vehicles to depart from Florida’s Kennedy Space Center on the planned roughly 10-day trip. Crew members have trained for years for this moment.

Reid Wiseman, the NASA astronaut serving as mission commander, said he doesn’t fear taking the voyage. A widower, he does worry at times about what he is putting his daughters through.

“I could have a very comfortable life for them,” Wiseman said in an interview last September.

“But I’m also a human, and I see the spirit in their eyes that is burning in my soul too. And so we’ve just got to never stop going.”

Wiseman’s crewmates on Artemis II are NASA’s Victor Glover and Christina Koch, as well as Canadian Space Agency astronaut Jeremy Hansen.

Photo: NASA’s Artemis II SLS rocket and Orion spacecraft being rolled out at night. Miguel J. Rodriguez Carrillo/Getty Images

What are the goals for Artemis II?

The biggest one: Safely fly the crew on vehicles that have never carried astronauts before.

The towering Space Launch System rocket has the job of lofting a vehicle called Orion into space and on its way to the moon.

Orion is designed to carry the crew around the moon and back. Myriad systems on the ship—life support, communications, navigation—will be tested with the astronauts on board.

SLS and Orion don’t have much flight experience. The vehicles last flew in 2022, when the agency completed its uncrewed Artemis I mission .

How is the mission expected to unfold?

Artemis II will begin when SLS takes off from a launchpad in Florida with Orion stacked on top of it.

The so-called upper stage of SLS will later separate from the main part of the rocket with Orion attached, and use its engine to set up the latter vehicle for a push to the moon.

After Orion separates from the upper stage, it will conduct what is called a translunar injection—the engine firing that commits Orion to soaring out to the moon. It will fly to the moon over the course of a few days and travel around its far side.

Orion will face a tough return home after speeding through space. As it hits Earth’s atmosphere, Orion will be flying at 25,000 miles an hour and face temperatures of 5,000 degrees as it slows down. The capsule is designed to land under parachutes in the Pacific Ocean, not far from San Diego.

Water photo: NASA’s Orion capsule after its splash-down in the Pacific Ocean in 2022 for the Artemis I mission. Mario Tama/Press Pool

Is it possible Artemis II will be delayed?

Yes.

For safety reasons, the agency won’t launch if certain tough weather conditions roll through the Cape Canaveral, Fla., area. Delays caused by technical problems are possible, too. NASA has other dates identified for the mission if it doesn’t begin April 1.

Who are the astronauts flying on Artemis II?

The crew will be led by Wiseman, a retired Navy pilot who completed military deployments before joining NASA’s astronaut corps. He traveled to the International Space Station in 2014.

Two other astronauts will represent NASA during the mission: Glover, an experienced Navy pilot, and Koch, who began her career as an electrical engineer for the agency and once spent a year at a research station in the South Pole. Both have traveled to the space station before.

Hansen is a military pilot who joined Canada’s astronaut corps in 2009. He will be making his first trip to space.

Koch’s participation in Artemis II will mark the first time a woman has flown beyond orbits near Earth. Glover and Hansen will be the first African-American and non-American astronauts, respectively, to do the same.

What will the astronauts do during the flight?

The astronauts will evaluate how Orion flies, practice emergency procedures and capture images of the far side of the moon for scientific and exploration purposes (they may become the first humans to see parts of the far side of the lunar surface). Health-tracking projects of the astronauts are designed to inform future missions.

Those efforts will play out in Orion’s crew module, which has about two minivans worth of living area.

On board, the astronauts will spend about 30 minutes a day exercising, using a device that allows them to do dead lifts, rowing and more. Sleep will come in eight-hour stretches in hammocks.

There is a custom-made warmer for meals, with beef brisket and veggie quiche on the menu.

Each astronaut is permitted two flavored beverages a day, including coffee. The crew will hold one hourlong shared meal each day.

The Universal Waste Management System—that’s the toilet—uses air flow to pull fluid and solid waste away into containers.

What happens after Artemis II?

Assuming it goes well, NASA will march on to Artemis III, scheduled for next year. During that operation, NASA plans to launch Orion with crew members on board and have the ship practice docking with lunar-lander vehicles that Elon Musk’s SpaceX and Jeff Bezos’ Blue Origin have been developing. The rendezvous operations will occur relatively close to Earth.

NASA hopes that its contractors and the agency itself are ready to attempt one or more lunar landing missions in 2028. Many current and former spaceflight officials are skeptical that timeline is feasible.

U.K. Economy Unexpectedly Contracts, Posing New Challenge to Government

Gross domestic product was 0.1% lower in January than in the final month of 2024.

The lunar flyby would be the deepest humans have traveled in space in decades.