Gross domestic product (GDP) growth has been described as "sluggish" by AJ Bell, after it increased marginally by 0.1% in November.

The latest data from the Office for National Statistics (ONS) found that this slight increase was a result of a growth in services, following a fall of 0.1% in October.

In terms of real GDP, the ONS revealed that there was no growth in the three months to November, compared with the three months to August.

Head of financial analysis at AJ Bell, Danni Hewson, said that while there has been a "tiny bit of growth" in November, GDP has "flatlined once again" over the three-month period.

She said: "At the start of last year it looked so promising as inflation cooled, businesses dusted themselves off and consumers dared to believe things would get better. And if you look hard you can see a few hardy green shoots, especially in the construction sector.

"But confidence since seems to have gone missing and that feeling is likely to persist into 2025, particularly if inflation insidiously creeps back up to uncomfortable levels which make it difficult for the Bank of England (BoE) to justify rate cuts.

"The newest member of the MPC, Professor Alan Taylor, has called for pre-emptive measures, saying he’s more worried about the sluggish nature of the economy than rising prices."

Services output increased by 0.1% month-on-month, mirroring the overall GDP figure, having also fallen by 0.1% in October.

Of the 14 sub-sectors, output increased in seven, while two showed no growth and five saw an output decline.

Monthly construction output is estimated to also have increased, jumping by 0.4% month-on-month. This follows a decrease of 0.3% in October.

In this sector, five of the nine sub-sectors saw an increase, with the main contributors to this monthly increase being private commercial new work (3.1%) and non-housing repair and maintenance (1.1%).

However, the production sector is estimated to have fallen by 0.4% in November, having fallen by 0.6% in October.

Three of the four sectors saw a fall in November, with the largest negative contribution coming from a 0.3% fall in manufacturing.

Investment strategist at Quilter Investors, Lindsay James, concluded: "This weak growth can in part be attributed to the fallout of the Government’s Budget, which saw consumers hit pause on spending. As we move further into this year we could see an even bigger impact. Businesses will soon feel the effects of increased national insurance contributions, the costs of which are likely to be passed on to employees. Wage growth is expected to take a hit, and spending could be dampened further as a result.

"Generally speaking, markets have been sceptical about the prospect of further rate cuts in the UK in the early part of this year, and less than two quarter point cuts are being priced in for the full year. The BoE stood alone in its decision to hold rates in December while the ECB and Federal Reserve forged ahead with cuts. However, should the economy fail to pick up at least some momentum and the UK falls into a recession, it may be forced to change tack."

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