Investing.com - The U.K. economy grew 0.7% in the final quarter of 2013, to record the fastest annual rate of growth since 2007, according to preliminary data released by the Office of National Statistics on Tuesday.
The U.K. economy grew 0.7% in the final three months of 2013, slowing slightly from growth of 0.8% in the previous quarter, and expanded 2.8% from a year earlier.
U.K. gross domestic product expanded 1.9% in 2013, much stronger than the 0.3% growth in 2012, and the fastest annual rate of growth since the financial crisis.
Overall growth remains 1.3% below its pre-financial crisis peak in the first quarter of 2008, and well the growth seen in 2007, when the economy grew by 3.4%.
Output in Britain's dominant service sector, which comprises more than three quarters of GDP, rose by 0.8% in the fourth quarter, matching growth in the previous quarter, which was the fastest in a year.
Manufacturing output expanded 0.9%, but industrial output growth slowed to 0.7% from 0.8% in the previous quarter, as oil and natural gas output fell. Construction output fell by 0.3%.
"We have now seen four successive quarters of significant growth and the economy does seem to be improving more consistently," Joe Grice, chief economist at the ONS said.
Last week, the International Monetary Fund upgraded its growth forecast for the U.K. economy from 1.9% to 2.4% this year, more than any other country, matching the forecast of the U.K.’s Office for Budget Responsibility.
Recent strong U.K. economic data has fuelled speculation that the Bank of England may raise interest rates from their current record lows of 0.5% much sooner than had been anticipated.
Data last week showed that the U.K. unemployment rate fell to 7.1% in the three months to November, just above the 7% threshold at which the BoE has said it would start to consider hiking rates.
However, BoE Governor Mark Carney indicated last week that the central bank is in no hurry to act.
“As good as the numbers have been in the last three quarters in the United Kingdom, we’re talking about three-quarters of household-led growth, an economy that’s running 20pc below pre-crisis trends, that has substantial spare capacity, that has not yet rebalanced and that faces significant headwinds from its major trading partner from overall monetary conditions,” he said.
“Exceptional stimulus remains very relevant to the environment.”