Economic growth slows to 0.5%

UK economic growth slowed more than expected in the three months to September, official figures show

UK economic growth slowed more than expected in the three months to September, official figures show. - Credit: PA

UK economic growth slowed more than expected in the three months to September, official figures show.

The news will ease pressure on the Bank of England to raise interest rates.

Analysts had forecast that growth would slow slightly from 0.7% in the second quarter to 0.6% in the third.

However, figures from the Office for National Statistics put third-quarter growth at 0.5%.

The powerhouse services sector continued its strong performance, growing 0.7% in the period, but was partially offset by a worrying 2.2% decline in construction output.

Annual growth figures were slightly below expectations at 2.3% - analysts had predicted growth of 2.4%.

Responding to the figures, Chancellor George Osborne warned there were more “tough decisions” required to keep the economy on track.

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“It is good news that Britain continues to outperform other western economies,” he said. But there are clear global risks and there is still much more to do to fix our economy.

“In the Autumn Statement we will take more steps to ensure we feel the recovery right across our country, make the long-term investments for the future and, crucially, continue to make the tough decisions required so that Britain lives within its means.”