UK economic growth revised down

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Britain's economy grew at a slower pace than thought in the final three months of 2006, but remained robust overall.

Gross domestic product (GDP) grew at 0.7% during the period from the previous quarter, the Office for National Statistics (ONS) said.

Despite growth being revised down from a previous estimate of 0.8%, the estimate for the annual rate of growth remained at 3%, the ONS said.

Growth was driven by growth in services and in business and finance.

The ONS added that service sector growth accelerated by 0.9% during the period, while business and finance sector output grew by 1%.

Retail and wholesale strength led to growth of 1.2% in the distribution sector, while household spending rose by 1%.

On the downside, production output fell by 0.2% - driven by a drop in utilities and mining output.

Experts said that despite the growth figures being revised down, they remained strong and were unlikely to alter expectations of a near-term interest rate increase from the Bank of England.

Separately, the ONS said the UK current account gap widened to a record £12.7bn, or 3.8% of GDP, in the final three months of 2006, from £10.5bn a year earlier.

The increase left the UK current account deficit at £43.3bn for the year, compared with a revised £29.2bn in 2005.