UK economic growth will weaken next year: Report

While the U.K.'s economic recovery may be the envy of it European neighbors, it is still the country's "weakest in the past century" and is set to slow next year, a leading British think tank warned on Wednesday.

The National Institute of Economic and Social Research (NIESR) forecast growth would slow to 2.5 percent in 2015, down from 3.0 percent his year, in its quarterly journal.

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"U.K. economic statistics have recently undergone significant revisions, but they do not change the broader picture: the turnaround of the U.K. economy remains the weakest in the past century," NIESR economists wrote in the journal.

Government figures suggest the U.K. grew by 3.0 percent year-on-year in the first nine months of 2014.

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NIESR repeated its warning that the key risk to the U.K. recovery was low productivity. Labor productivity—a measure of the amount of goods and services produced by one hour of labor—was still around 4.5 percent below the pre-crisis peak of 2007, the institute warned in August.

"U.K.'s large productivity puzzle persists," said NIESR in its November journal. "Should this fail to recover as we expect, the impact on both living standards and public finances will be significant."

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Externally, NIESR said the weakness of the global recovery and, in particular, continued stagnation in the euro area, were also significant risks for the U.K.

On Tuesday, the European Commission warned that European economy was "not improving fast enough" and slashed its growth forecasts. The euro zone is now seen growing by 0.8 percent this year and 1.1 percent next.

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In better news for the U.K., Barclaycard reported on Wednesday that consumer spending in the country rose by 4.2 percent during the third quarter—the biggest rise since 2011.