Britain's economy grew at its weakest rate in three years in the first quarter as the credit squeeze took its toll and energy output contracted.
The UK's Office for National Statistics said the economy grew 0.4% in the first three months of the year, in line with expectations and down from 0.6% in the final quarter of 2007.
The annual growth rate slipped to 2.5%, slightly below the consensus forecast of 2.6%, from 2.8% previously.
The figures show the economy is now growing below trend, potentially giving the Bank of England more leeway to cut interest rates.
However, policymakers have indicated some slowing of the economy is necessary to curb inflationary pressures, so further rate cuts are likely to be gradual.
Service sector growth decelerated to 0.6% on the quarter from 0.7% in the final quarter of last year. Within that, growth in business services and finance slowed to 0.4% - the weakest rate in almost five years.
