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Fastest annual economic growth since 2007

The UK economy grew by an annual rate of 2.6% across 2014, figures from the Office for National Statistics (ONS) show.

This is higher than the 1.7% annual growth rate recorded in 2013, and is the fastest annual growth in GDP since 2007.

The economy grew 0.5% in the final quarter of last year. This was the slowest quarterly growth rate recorded in 2014.

Key Q4 2014 figures:

  • the services sector grew by 0.8%
  • the construction sector contracted by 1.8%
  • the rate of production fell 0.1%, its worst performance in 2 years
  • the agriculture sector grew 1.3%.

"Advancing at a steady pace"

Business leaders were broadly optimistic despite the slowdown in the fourth quarter.

Rain Newton-Smith, director for economics of the Confederation of British Industry, said:

"These figures confirm that growth slowed slightly compared with the previous quarter. Service sector growth remains robust, but manufacturing continues to struggle with weaker export orders, and construction output has fallen in the last three months."

John Allan, national chairman of the Federation of Small Businesses, said the economic outlook "remains positive":

"We see the recent sharp decline in fuel costs coupled with the pick-up in wages as providing a further fillip to these growth plans.

"The key now is to maintain policies to support private sector growth, and to continue efforts to rebalance the economy. As these results show, the service sector continues to dominate the picture."

David Kern, chief economist of the British Chambers of Commerce, said:

"While there is ongoing debate about the possibility of a prolonged slowdown, we must reject the defeatist view that this is unavoidable. If the incoming government fosters the growth aspirations of businesses, the UK economy can regain its dynamism and achieve sustained growth."

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