Britain's third-quarter economic growth was confirmed at 0.4% quarter-on-quarter, with household spending helping support the economy during the period.
The final estimate for the July-September period showed household spending growth contributed 0.3 percentage points of economic growth, however, the annual rate of growth in household spending fell to its lowest level since 2012 due to mounting inflationary pressures.
Squeeze on households
The gap between consumer price inflation at 3.1% and average annual wage growth at 2.3% has kept pressure on household budgets during the second half of the year.
Many economists, however, expect this effect to ease in the coming months as the effects of a weaker pound earlier in the year start to have less of an impact.
Services remained the strongest contributor to growth in the third quarter, increasing 0.4%, while business investment growth softened to 0.2%.
While it makes up a small percentage of the UK's overall economy, production output increased 1.1% in the quarter.
One of the biggest drags was construction, which was estimated to have decreased by 0.9% in the quarter, revised down from the preliminary estimate of a 0.7% decline. It was the second-successive quarter of falling construction output.
Annual growth revised up
Annual growth, however, was revised up in the July-September period to 1.7% from 1.5%, while 2016's full-year growth was revised higher to 1.9% from 1.8%.
Capital Economics was upbeat about the outlook for UK growth.
"With the squeeze on households’ real earnings set to abate, and a chance that Brexit uncertainty actually recedes, rather than build further as negotiations progress, we suspect the economy will gain a little momentum next year, and forecast growth of 2.2% in 2018," said senior UK economist Paul Hollingsworth.
The pound rallied 0.2% against the euro to €1.1297 in mid-morning trade. Stock in London were also higher, and the FTSE 100 touched a new record high at 7,611.49, leaving it 6% higher in 2017.