Britain's economy grew faster than expected in the fourth quarter, driven by the services sector, official data showed today, even as the production industries slipped into technical recession.
The Office for National Statistics said today the British economy grew by 0.7 per cent in the fourth quarter compared with 0.5 per cent in the July-September period and above the 0.6 per cent quarterly growth that economists had expected.
That brought the annual rate of growth to 2.8 per cent compared with a revised 3.2 per cent in the third quarter.
That was also ahead of expectations of 2.7 per cent and brought the economy's growth rate in line with what the Bank of England had projected in its November Inflation Report.
For the full year, the ONS estimated that the economy grew by 3.1 per cent, roughly in line with the BoE and Treasury's forecasts, and marking the fastest rate of growth since 2000.
It was also well ahead of the 2.2 per cent recorded in 2003. While the services sector, which accounts for around 72 percent of the whole economy, grew 1.0 per cent on the quarter, the output of the production industries contracted 0.5 per cent, the second quarterly fall in row.
While many economists would call this a technical recession, the ONS said it would not comment on the definition of a recession and whether the manufacturing recovery was over.