UK economic growth slows due to service sector slowdown

UK GDP expanded by just 0.3% in the first three months of this year as inflation hit the service sector.

Britain's GDP report by the Office for National Statistics this morning showed growth was down from 0.7% in the final three months of 2016, the slowest reading since the first three months of last year.

The slowdown is being blamed on the falling growth of hotels, restaurants and retailers, which have been forced to hike prices due to higher input costs with the fall of sterling after the EU referendum. Britain's service sector output expanded by just 0.3% in January-March 2017, down from 0.8% in October-December 2016.

However, sterling has hit its highest level against the US dollar since September 2016, jumping by 0.3% this morning to $1.2939, a seven-month high, and is a little higher against the euro at €1.1881.

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