Britain’s economy grew 0.4% in July, beating economists’ median forecast for no growth and following a 0.3% rise in June. The economy expanded 1% in the first half of 2026, the fastest pace in the G7, while Bank of England Governor Andrew Bailey said this week that activity had been “a bit stronger” than expected. The rebound reduces near-term recession risk, but resilient demand alongside the renewed energy shock may make the Bank more cautious about inflation and reinforce expectations of another rate rise. Sterling edged higher, while gilt yields eased slightly as wider global market pressures remained the stronger influence.