UK services grow less than hoped

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Consumer services grew less than expected during the past three months, according to a CBI survey.

A net 13% balance of service firms said profits had increased annually for the quarter, less than the 19% predicted, the employers group said.

But confidence among firms about the next quarter is rising at the fastest pace since February 2007, the CBI said.

The group's chief economic adviser Ian McCafferty said the survey underlined the "fragility" of the recovery.

"Consumers and businesses are continuing to cut back on spending on goods and services, and firms operating in the sector are responding by cutting prices to stay competitive," he said.

In the survey, 40% of retailers said that their volume of sales in the year to November had risen, while 27% said they fell.