Economy growth rate slowed in 2005

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Economy growth rate slowed in 2005

Wed 26th Apr 2006

The UK economy grew at a significantly slower rate last year, according to government figures.

National Statistics revealed this morning that GDP growth in 2005 rose by 1.8 per cent compared to 3.1 per cent in 2004.

Figures for the final quarter of last year showed a modest increase with GDP up 0.6 per cent from 0.5 per cent in the previous three months.

This slight increase was driven by the services sector and strong performance in transport, storage and communications.

Energy extraction saw a 0.8 per cent rise but manufacturing output declined by 1.1 per cent.

The figures confirm the general consensus that rising oil prices and wider global pressures took their toll on the UK economy last year.

While the most recent figures show a slight improvement in GDP growth, they could put pressure on the Bank of England to consider a cut in interest rates.

The base rate is currently at 4.5 per cent and has not moved since August last year.