Mixed prospects for UK GDP despite 0.7% Q4 rise

However, GDP growth for 2016 was revised down from 2.2 per cent to 2 per cent on the back of weaker exports in the first quarter of the year.

Britain's economy grew by a better-than-expected 0.7 percent in the final three months of previous year, official revised data showed Wednesday as the country prepares for Brexit.

That pushed Britain's economic growth rate slightly below Germany's 1.9 percent.

The estimate for business investment was also disappointing, showing a 1 per cent contraction over the final quarter of a year ago. With Brexit negotiations afoot and ongoing geopolitical concerns among the G7, the knock on effect on business confidence may slow the pace of growth in 2017, both at home and overseas.

Chris Williamson, chief business economist at IHS Markit, said: "The news of faster the previously thought growth at the end of a year ago is marred by worrying signs about the durability of the upturn".

"We should bear in mind that the investment data are often subject to heavy revision, and businesses generally remain upbeat about the year ahead".

"Revisions to industrial production and construction data earlier this month had suggested the preliminary estimate would be nudged up". Wednesday's data showed compensation of employees edged up by 0.1 percent in the fourth quarter, the weakest rise in more than three years.

Growth was revised lower for the first quarter between January and March.

GDP in current prices increased by 1.4% between Quarter 3 2016 and Quarter 4 2016. "We also need to acknowledge that a big driver of United Kingdom growth in Q4 last year came from consumption, but with prices on the rise consumers may start to rein in spending, something we've already seen in the drop in retail sales at the beginning of this year". Meanwhile, business investment dropped 1 percent to GBP 43.5 billion.