UK economic growth eased back to 0.5 per cent in the third quarter, down from 0.7 per cent in the previous three months according to official numbers.
As a result the annual pace of growth moderated to a two-year low of 2.3 per cent during the three months, down from 2.4 per cent in the second quarter.
Figures from the Office for National Statistics show GDP expansion was chiefly held back by a contraction in both the construction and manufacturing sectors where output dropped respectively by 2.2 per cent and 0.3 per cent.
However, the dominant services sector strengthened slightly to 0.7 per cent, from 0.6 per cent quarter-on-quarter.
Despite the fall in economic growth, Chancellor George Osborne remained upbeat, tweeting: “GDP is 0.5 per cent. UK continues to outperform other major economies. But global risks mean we go on with tough decisions to live within our means.”
IHS Global Insight chief UK and European economist Howard Archer added: “Despite softer expansion in the third quarter, we remain relatively upbeat over UK growth prospects. We expect GDP growth to come in at 0.6 per cent quarter-on-quarter in the fourth quarter, resulting in overall GDP growth of 2.4 per cent in 2015.
“We see GDP growth also coming in at 2.4 per cent in 2016. The consumer should remain pretty well positioned to contribute appreciably to growth in 2016.”
Meanwhile Shaun Port, chief investment officer at investment management service Nutmeg, said consumer sentiment was improving with a strong jobs market and wages “starting to creep up”.
