UK fourth-quarter growth unrevised, helped by business investment

LONDON (Reuters) - A pick-up in business investment helped to drive robust growth in Britain's economy during the final three months of 2013, a sign that the economic recovery is broadening. Gross domestic product rose by 0.7 percent in the fourth quarter, the Office for National Statistics said, unrevised from an earlier estimate and in line with forecasts. The figures capped off the fastest rate of growth last year since the financial crisis. While household spending has driven the upturn so far - and rose a strong 0.4 percent on the quarter - the latest data showed business investment rose 8.5 percent compared with the same period a year ago, which was the fastest upturn since the first quarter of 2012. The ONS said household expenditure and net trade also contributed strongly to growth in the fourth quarter. The Bank of England expects a pick-up in business investment in 2014, something it sees as essential to secure the economic recovery and help spur long-awaited growth in productivity. BoE Governor Mark Carney has questioned the reliability of the ONS's business investment data, saying other surveys have suggested stronger growth in spending by companies. With a few weeks to go before the government announces its annual budget on March 19 - barely a year before the next election - the upturn in business investment will buoy finance minister George Osborne. Osborne earlier this month emphasised the need for more manufacturing exports, and said the country's economic growth cannot rely only on consumers or the City of London. Wednesday's data took Britain's full-year growth for 2013 up to 1.8 percent, from just 0.3 percent the year before. This is the highest since 2007, although total output is still 1.4 percent below the pre-financial crisis peak reached in the first three months of 2008 - a weaker situation than in almost all other big advanced economies. Business surveys have suggested the momentum behind the recovery has largely carried through into the first months of 2014. In the fourth quarter, net trade contributed 0.4 percentage points to growth after being a drag in the third quarter. Output in Britain's service sector - which makes up more than three quarters of GDP - rose by 0.8 percent in the fourth quarter, the same rate of growth as in the third quarter. Industrial output was 0.5 percent higher, while construction - which accounts for less than 7 percent of GDP - expanded by 0.2 percent. (Reporting by Andy Bruce and William Schomberg)