New figures from the Office of National Office of Statistics have shown business investment to fall for the third consecutive month.
The latest ONS figures said that in the three months to the end of September, business investment fell by 1.1% to £46.9 billion.
This is the first time that investment has fallen for three consecutive quarters since the 2009 recession.
ONS statistician Rob Kent-Smith said: “The longer-term picture remains subdued and business investment has now fallen for three consecutive quarters.”
News on Friday also revealed car production to fall for the fifth consecutive month.
The industry’s trade body showed output to tumble by 20% amid Brexit concerns, falling to the lowest point since the 2009 recession. November is the fifth consecutive month for production to fall.
As well as the fall in car production and business investment, the UK deficit widened by £6.6 billion to £25 billion.
“The further, marked rise in the current account deficit is disappointing as an elevated shortfall is a potential source of vulnerability for the UK economy – particularly if there was any major loss of investor confidence in the UK for any reason such as Brexit concerns,” said Howard Archer, an analyst from EY Item Club.
ONS figures also revealed a growth to the economy, where GDP grew by 0.6% in the third quarter.
Growth was helped by the services sector, construction and manufacturing.
“Today’s figures confirm the economy picked up in the third quarter with a solid showing from services and construction,” said Kent-Smith.
“However, the longer-term picture remains subdued and business investment has now fallen for three consecutive quarters. Households continued to spend more than they received, for an unprecedented eight quarters in a row.”
Samuel Tombs, who is the chief UK economist at Pantheon Macroeconmics, said consumers are currently keeping economic growth alive, however this is not sustainable and business investment is necessary.
“The recent deterioration in consumers’ confidence and the pick-up in saving intentions suggests that growth in spending will slow in the near-term, even though real wages should start to rise at a faster rate,” he said.
“Accordingly, the latest national accounts do not inspire confidence that the economy will pull through the current political crisis unscathed.”
