THE UK’s first-quarter economic performance was even weaker than estimated initially, official figures have revealed, with growth in spending by under-pressure households slowing dramatically as Brexit vote effects hit home.

Revised data published yesterday by the Office for National Statistics showed UK gross domestic product (GDP) rose by just 0.2 per cent quarter-on-quarter during the opening three months of this year. This represents a very sharp slowdown from 0.7 per cent expansion in the final quarter of 2016.

Last month, the ONS had estimated first-quarter GDP growth at 0.3 per cent.

The ONS yesterday revised down UK manufacturing growth in the first quarter from 0.5 per cent to just 0.3 per cent. And the key services sector is now calculated to have grown by only 0.2 per cent in the opening three months of this year, rather than by 0.3 per cent as estimated previously.

UK household spending growth slowed sharply to just 0.3 per cent in the first quarter, from 0.7 per cent in the final three months of last year, the latest ONS figures show. Household spending has played a key part in UK growth in recent times, but sterling’s plunge since the Brexit vote has triggered the first real-terms fall in average earnings for about two-and-a-half years.

Sterling’s tumble has sent annual UK consumer prices index inflation surging. Annual CPI inflation was 2.7 per cent in April. It was only 0.3 per cent last May, ahead of the Brexit vote.

ONS figures earlier this month showed average weekly earnings for employees in Great Britain in the three months to March, excluding bonuses, were down by 0.2 per cent on a year earlier in real, inflation-adjusted terms.

Frances O’Grady, General Secretary of the Trades Union Congress, said of the latest GDP figures: “This is a very worrying sign of the squeeze that families are feeling. Prices are rising faster than earnings, and households are getting deeper into debt.”

She added: “The next government will inherit an economy that needs serious attention.

“An urgent priority must be to reverse the current fall in living standards. The minimum wage must go up faster, and the pay restrictions on public servants like nurses, firefighters and midwives must be ended.”

The latest ONS figures show UK exports dropped by 1.6 per cent in the first quarter. This fall occurred in spite of the boost to UK manufacturers’ relative competitiveness in overseas markets arising from the pound’s weakness.

Chris Williamson, chief business economist at IHS Markit, said: “The economy got off to an even worse start to the year than previously thought.”

Mr Williamson said it was “hard to see any bright spots in the breakdown of the data with the sole exception of business services and finance”.

The business services and finance sub-sector grew by 0.6 per cent in the first quarter, albeit this was not as strong as the previous estimate of 0.7 per cent expansion.

The fall in output of the distribution, hotels and catering sub-sector, which is dependent on consumers, was revised from 0.5 per cent to an even-steeper 0.6 per cent.

Noting the UK economy had continued to be held back in April as “consumer spending remained under pressure from higher prices and low pay growth”, Mr Williamson said: “If anything, the squeeze on household finances worsened further in May.

“IHS Markit’s household finance index showed current finances worsening to one of the greatest extents in the past three years.”

He added: “While the survey data for April therefore offer a tentative suggestion that second-quarter economic growth may be slightly stronger than the 0.2 per cent expansion seen in the first quarter, there’s every possibility that growth could wane again later in the year unless inflationary pressures ease and wages start to show stronger growth.”