UK economy growing at close to potential, NIESR says

The economy slowed down last year but continued to grow at close to its potential rate, one of the country's largest think-tanks said on Tuesday.

Britain's economy expanded at a 0.6% quarter-on-quarter clip in the last three months of 2015, the same as in the previous quarter, the National Institute for Economic and Social Research said.

That meant the rate of growth in gross domestic product for the year came down from the 2.9% pace seen in 2014 to 2.2%.

According to Jack Meaning, NIESR research fellow: “The slowdown in the economy last year was largely due to a sharp moderation in growth of the construction sector and public spending, exacerbated by weaker net trade.

"The year looks to have ended with reasonable growth, close to the economy’s long-run potential. There is little spare capacity in the economy, and we expect the output gap to continue to close in 2016.”