London, Jul 27 (IANS): Britain's GDP grew 0.3 per cent in the second quarter, a weaker increase from that of the previous quarter and below the central bank's projection, amid continued economic sluggishness.

The GDP growth was 0.1 percentage point higher than that of the first quarter, but did not meet the forecast of 0.4 per cent by the Bank of England (BOE), Britain's central bank, according to data released by the Office of National Statistics on Wednesday.

The slight increase over the first quarter was far below a growth of 0.7 per cent over the quarter in the final quarter of 2016.

This represents an economic slowdown from last year, as the new data will bring the annual growth rate down, below the 1.9 per cent expectation of the BOE at its last forecast in May.

The growth in the second quarter was driven by services dominating the UK economy. The service sector grew 0.5 per cent, with much of the improvement made in the performance of the retail sector.

"For some, the rebound in the retailing and catering/hotels sub-sectors of the services economy will serve as evidence that the consumer-led slowdown may not be too severe," said Sam Hill, chief UK economist at the Royal Bank of Canada in London.

"However, for retail and wholesale, the level of output is only the same now as it was at the end of 2016, despite the Q2 recovery, so there is some retrenchment in the sector," Hill said.

The BOE's rate-setting Monetary Policy Committee (MPC) will meet early next month to decide whether to raise the current record-low interest rate from its 0.25 per cent mark.