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UK GDP worst since 2012

Britain’s economy slowed as expected in the final three months of last year, pushing growth in 2018 to its weakest in six years, as Brexit worries hammered investment into the UK.

Gross domestic product growth in the final quarter of 2018 fell to a quarterly rate of 0.2 percent from 0.6 percent in the previous quarter. This was in line with the average forecast in a poll of economists though slightly weaker than the Bank of England estimated last week.

For 2018 as a whole, growth dropped to its lowest since 2012 at 1.4 percent, down from 1.8 percent in 2017. Exports suffered from global weakness and consumers and businesses grew increasingly concerned about the lack of a plan for when Britain is due to leave the European Union on March 29.

Last week the BoE chopped its forecast for growth this year by 0.5 percentage points to 1.2 percent, which would be the weakest year since the 2009 recession.

Theresa May has rejected the idea of targeting a customs union with the European Union, pouring cold water on hopes from some that she could shift her Brexit policy to win over the opposition Labour Party.

Last week, Labour leader Jeremy Corbyn set out the conditions under which he would instruct his party to support an exit deal in parliament. Foremost was a demand that May seek a “permanent and comprehensive UK-wide customs union”.

The EU has urged May to grasp Labour’s compromise offer rather than press ahead with her preferred option of getting her own divided party onside by renegotiating a clause in the exit agreement relating to the Northern Irish border.

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