UK economy set for sluggish growth, warns business group

Inflation, cautious consumers and weak pound will be drag on output, says BCC, which puts 2017 GDP at 1.1%

The UK economy will slow markedly next year as uncertainty about the country's future position in Europe and higher inflation hit consumers and businesses, the British Chambers of Commerce (BCC) has predicted.

The business group believes the UK will avoid recession but still lose momentum as the weak pound pushes up import costs and the resulting rise in inflation erodes people's spending power.