Household expenditure went up 0.2 percent, below 0.3 percent in each of the previous three quarters. It is the lowest gain since a 0.2 percent drop in Q4 2014. Also, consumption of non-profit institutions fell 1.1 percent after a 0.1 percent drop in Q4.
Gross fixed capital formation (GFCF) rose at a slower 0.9 percent (1.1 percent in Q4), mainly driven by private dwelling and general government sectors. However, business investment, which makes up the largest proportion of total GFCF, decreased 0.2 percent, the biggest drop since Q3 2015 and following a 0.3 percent gain in Q4. Falls in other buildings and structures, and transport were the reason for the decrease. These falls were partially offset by positive growth from information and communication technology (ICT) equipment and other machinery and equipment, and intellectual property products.
The trade deficit narrowed slightly to GBP 9,228 million in volume terms from GBP 9,375 million in Q4. Total imports decreased by 0.6 percent (+0.4 percent in Q4) and exports shrank 0.5 percent (-0.9 percent in Q4). Decreases in both imports and exports in nominal terms were larger than decreases in volume terms, which may be linked to movements in the sterling exchange rate seen in Q1.
On the other hand, government spending rose 0.5 percent, slightly higher than 0.4 percent in Q4.
Year-on-year, the economy rose 1.2 percent, below 1.4 percent in Q4 but matching the preliminary estimate. It is the weakest pace of expansion since Q2 2012.