UK incomes see sluggish growth

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Real disposable incomes in the UK grew just 0.2% in the third quarter of 2017 as the weak pound continued to fuel inflation, official figures indicate.

Consumer spending went up 1% in the July-to-September period, the lowest rise for more than five years, the Office for National Statistics said.

The pound has fallen in value since the UK voted to leave the EU, making imported goods more expensive.

The UK’s GDP grew 0.4% in the quarter, unchanged from the previous estimate.

The figure is better than the 0.3% recorded in the first and second quarters, but weaker than the final three months of 2016, when economic growth of 0.6% was recorded.

Earlier this week, the International Monetary Fund (IMF) cut its UK economic growth forecast, blaming Brexit uncertainty.

The IMF expects UK growth of 1.6% this year, down slightly from its previous forecast of 1.7%. It expects growth to slow further next year, to 1.5%.

The ONS added that UK households’ expenditure had exceeded income for four quarters in a row, suggesting that people are dipping into savings to fund their spending.

It said it was the first time since current records began in 1987 that this had happened over such a long period of time.

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