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UK economic growth slows to 0.4% in first quarter | UK economic growth slows to 0.4% in first quarter |
(35 minutes later) | |
The UK's economic growth slowed in the first quarter of the year, hit by a drop in manufacturing and construction output, official figures have shown. | |
Gross domestic product grew by 0.4% between January and March, down from 0.6% in the fourth quarter, the Office for National Statistics (ONS) said. | Gross domestic product grew by 0.4% between January and March, down from 0.6% in the fourth quarter, the Office for National Statistics (ONS) said. |
On an annual basis, growth was 2.1%. | On an annual basis, growth was 2.1%. |
The 0.4% rate was in line with economists' expectations, and marks the 13th consecutive quarter of positive growth for the UK. | The 0.4% rate was in line with economists' expectations, and marks the 13th consecutive quarter of positive growth for the UK. |
Part of the slowdown was due to a sharp fall in construction output, which dropped 0.9% in the first quarter. Production output declined by 0.4%. | |
The service sector, the biggest part of the economy, grew by 0.6% | The service sector, the biggest part of the economy, grew by 0.6% |
"Services continue to underpin the economy but other sectors have shown falling output this quarter," said ONS chief economist Joe Grice. | |
This is the first estimate of economic growth for the period, using less than half the data that will be used for the final estimate. | This is the first estimate of economic growth for the period, using less than half the data that will be used for the final estimate. |
Losing pace | |
The Bank of England warned earlier this month that uncertainty due to the EU referendum could hurt growth in the first half of this year. | |
Pantheon Macroeconomics chief UK economist Saumuel Tombs said the slowdown in the first quarter "likely marks the end of the UK economy's outperformance relative to other G7 economies". | |
Mr Tombs said the UK's economy had been steadily losing pace since 2014 "suggesting that Brexit concerns are only partly to blame for the weakness of first quarter GDP". | |
"The EU referendum cannot be blamed for all of the economy's ills," he added. | |
But Capital Economics UK economist Ruth Miller said she expected the slowdown to be temporary. | |
"Many of the factors likely to be to blame for the first quarter's weakness should prove short-lived. We would not be surprised if growth were to subsequently accelerate in the second half of the year, putting the economy back on track," she added. |