The UK economy unexpectedly shrank by 0.1% in October, defying forecasts for modest growth and extending the weak run with little expansion since mid year. Official Office for National Statistics data showed output contracting across key areas including services and construction, with only a modest rebound in manufacturing after the Jaguar Land Rover cyber-attack. Pre-Budget uncertainty, which dampened consumer and business spending, appears to have played a significant role in slowing activity. Analysts now see this as further evidence of sluggish momentum in the economy, reinforcing expectations that the Bank of England will cut interest rates at its December policy meeting to support demand. Markets have priced in a likely quarter-point reduction in the base rate, with sterling slightly weaker and government bond prices rising on the news. These weak GDP figures pose a challenge for the government’s growth agenda and highlight persistent risks of stagnation as inflation cools but remains above target.