The ONS’s estimate shows only a slight improvement from Q1 when GDP increased by 0.2%
Growth was driven by services, mainly retail trade and film production and distribution, which grew by 0.5% compared with 0.1% in Q1.
However, construction and production acted as a drag, it added.
Darren Morgan, head of national accounts at the ONS, said the economy had experienced a “notable slowdown in the first half of this year”.
He added: “While services such as retail and film production and distribution showed some improvement in the second quarter, a weaker performance from construction and manufacturing pulled down overall growth.”
Nathan Sweeney, senior investment manager at Architas, said the figures show the UK economy is “flatlining” and will have those opposed to Brexit warning this will only get worse.
He added: “However, the effects or potential impacts of Brexit are not the underlying cause of the weakness in data. The reality is the UK economy has been slowing since well before the Brexit vote took place. And it has been trending down for a number of years.
“The bigger picture is that there has been a significant failure by the central bank to stimulate growth in the UK economy. It is clear that the central bank is now stepping back and will begin to withdraw its monetary stimulus in the form of quantitative easing, which while it staved off a full blown crisis has not succeeded in boosting long term growth.
“With the uncertainty around Brexit negotiations and the weak data on growth the outlook for the UK economy is far from rosy.”
But Ben Brettell, senior economist at Hargreaves Lansdown, said despite the lacklustre growth, there are tentative signs that things might improve in the second half.
He said: “Last week saw news that retail sales rose ahead of expectations, indicating the consumer may still have some petrol in the tank – though the Bank of England has expressed caution over rising levels of personal debt. Meanwhile inflation began to recede, which if it continues in the coming months could end the squeeze on real incomes.
“As ever it’s worth noting that initial GDP estimates can usually be taken with a pinch of salt, as they are based on less than half of the data which will ultimately be available, and are therefore subject to revision in the coming months.”
The announcement follows weak inflation figures reported last week showing the Consumer Prices Index, including owner occupiers’ housing costs (CPIH), fell to 2.6% in June, compared with 2.7% in May.
