Growth between Q3 2016 and Q3 this year stood at just 1.7%, the lowest rate between the same quarter in different years since 2013, according to the ONS’s monthly economic release.
Overall, the economy grew 0.4% between July and September this year, unrevised from previous estimates, due to strong performances from accounting, recruitment and retail.
The latest release was the first time VAT turnover data was used to measure GDP, although the final revisions as a result of its inclusion was “small”.
The ONS’s head of national accounts Darren Morgan said: “Today’s unrevised third quarter figures show most of the growth came from the dominant service sector, with accounting, recruitment agencies and retailing all performing well.
“Manufacturing also boosted growth thanks to an increase in exports and the introduction of new car models. Meanwhile, household spending and business investment both grew steadily.
“This is the first time we have used VAT returns from hundreds of thousands of small and medium-sized businesses to help us calculate GDP. These returns improve the quality of our estimates and will allow us to paint a much more detailed picture of the UK economy.”
Real disposable incomes struggled during the quarter, growing just 0.2% in Q3 as the weak pound edged inflation higher.
However, the UK budget deficit shrank by about £3bn in Q3 2017 and now accounts for 4.5% of GDP.
It fell to £22.8bn in Q3, down from the £25.8bn reported in Q2.
Growth in household consumption fell and was revised down to 0.5% for Q3 and household savings also fell, with the ratio dropping from 5.6% to 5.2%.
