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UK economic growth rate edges higher UK economic growth rate edges higher
(35 minutes later)
The UK economy grew by 0.3% in the three months to June, driven in part by a booming film industry, said the Office for National Statistics (ONS), The UK economy grew by 0.3% in the three months to June, driven in part by a booming film industry, said the Office for National Statistics (ONS).
The initial estimate showed growth picking up from the first quarter of the year, when it was 0.2%.The initial estimate showed growth picking up from the first quarter of the year, when it was 0.2%.
The ONS said the growth was driven by services, particularly retail, which more than offset falls in output in the manufacturing and construction sectors.The ONS said the growth was driven by services, particularly retail, which more than offset falls in output in the manufacturing and construction sectors.
It added there had been a "notable slowdown" in growth from last year.It added there had been a "notable slowdown" in growth from last year.
However, the figure for the second quarter was in line with economists' expectations.However, the figure for the second quarter was in line with economists' expectations.
Analysts said the rise in growth was unlikely to change expectations that the Bank of England will keep interest rates at their current record low next week.Analysts said the rise in growth was unlikely to change expectations that the Bank of England will keep interest rates at their current record low next week.
ONS head of national accounts Darren Morgan said: "The economy has experienced a notable slowdown in the first half of this year."ONS head of national accounts Darren Morgan said: "The economy has experienced a notable slowdown in the first half of this year."
Film production in the UK, plus box-office receipts from cinemas, was one of the best performing parts of the economy during the period.Film production in the UK, plus box-office receipts from cinemas, was one of the best performing parts of the economy during the period.
The ONS said ticket receipts from Wonder Woman and the latest Pirates of the Caribbean film were among the items that had boosted the sector it calls motion picture activities.
"While services such as retail, and film production and distribution showed some improvement in the second quarter, a weaker performance from construction and manufacturing pulled down overall growth," Mr Morgan said."While services such as retail, and film production and distribution showed some improvement in the second quarter, a weaker performance from construction and manufacturing pulled down overall growth," Mr Morgan said.
'Not complacent''Not complacent'
On Monday, the International Monetary Fund downgraded its forecast for UK economic growth this year because of the weak first-quarter figure.On Monday, the International Monetary Fund downgraded its forecast for UK economic growth this year because of the weak first-quarter figure.
The IMF said it expects UK GDP to grow by 1.7% instead of its previous projection of 2%.The IMF said it expects UK GDP to grow by 1.7% instead of its previous projection of 2%.
Chancellor Philip Hammond said the UK economy had now grown consistently for four-and-a-half years.Chancellor Philip Hammond said the UK economy had now grown consistently for four-and-a-half years.
"We can be proud of that, but we are not complacent," he added."We can be proud of that, but we are not complacent," he added.
"We need to focus on restoring productivity growth to deliver higher wages and living standards for people across the country.""We need to focus on restoring productivity growth to deliver higher wages and living standards for people across the country."
Dennis de Jong, managing director at UFX.com, said that after the first quarter's "poor" figure, the "slightly stronger" second-quarter figure could "barely be described as a bounce back". Labour shadow chancellor John McDonnell said: "Today's GDP figures reveal weak growth under a weak government, and expose the last seven years of Tory economic failure.
He added: "The weaker pound is continuing to drag consumer spending down and it's hard to see growth gaining any momentum heading into the second half of the year. It's now just the services sector that is saving the economy from flat-lining. "Growth for the first half of 2017 is below expectations, and it follows continued data showing working families are being squeezed with wages not keeping up with prices."
"The UK appears to be heading towards unsavoury levels of inflation and business conditions are struggling amidst heightened Brexit uncertainty." 'Patchy data'
Aberdeen Asset Management chief economist Lucy O'Carroll said: "This pick-up will be taken as good news, but it really doesn't amount to much.
"The figures are the first estimate of growth, based on very patchy data. They always get revised over time, and often substantially so.
"It's the underlying trends that matter. They don't look favourable at the moment, given the uncertainties around Brexit and the pressure on household budgets from higher inflation."