According to official figures, the British economy grew less than previously estimated between April and June.

It grew by 0.5%, from an initial 0.6%, after output in manufacturing and construction fell more sharply than initially expected.

The data was released as the Labor government, which has made economic growth one of its key policies, prepares to announce its first budget in four weeks.

Labor has been criticized for its bleak outlook after Prime Minister Sir Keir Starmer warned the budget would be “painful”. Chancellor Rachel Reeves recently tried to strike a more optimistic toneHe said Britain’s “best days lie ahead”.

Paul Dales, chief UK economist at Capital Economics, said the downward revision “should not cause the Bank of England to worry too much that the economy could lose momentum”.

The latest growth figures are not expected to lead to any significant changes the Office of Budget Responsibilitythat makes forecasts for the next month’s budget.

The independent forecaster monitors the government’s spending plans and performance and publishes its forecasts at the same time as the government’s budget presentation.

The Office for National Statistics (ONS), which released the figures, said production of transport and related equipment fell by 3.1% between April and June after a long period of growth.

A decline of 0.7% was initially expected.

The ONS said there was evidence that carmakers had cut production as they prepared to switch to electric cars.

Due to the continued decline in the construction of new houses, construction activity also fell. However, the ONS said there were some signs that the situation was starting to ease.

Mr Dales said that while the downward revision was not a major cause for concern, “it could reinforce the Bank’s view that interest rates need to be cut further.”

The Bank of England cut interest rates from 5.25% to 5% in August for the first time in almost four years as inflation cooled.

The ONS raised economic growth for last year from 0.1% to 0.3% due to better income data as well as new updated information on the size of various industries.

The figures also showed that the household savings rate rose to 10% in the spring, compared to 8.9% in the first three months of the year, “meaning people are keeping more of their disposable income in savings.”

Liz McKeown, director of economic statistics at the ONS, said: “Our latest data shows that household savings continue to rise and are now at their highest level since the Covid-19 lockdowns.”