Services sector output 'grew strongly' in July despite Brexit vote

Output in Britain's services sector "grew strongly" in July, defying expectations of a slowdown in the wake of the Brexit vote.

Official figures showed that services output expanded by 0.4% in the first month after Britain voted to leave the European Union.

Darren Morgan, head of GDP at the ONS, said the fresh data shows there is "no sign of an immediate shock to the economy" from the EU referendum result.

The update came as the Office for National Statistics (ONS) revised up its reading for the UK economy, with gross domestic product (GDP) growing 0.7% in the second quarter, up from a previous estimate of 0.6% for the period.

The ONS said the revision was triggered by a better performance from services and investment in the three months to June.

Economists were forecasting services sector output to slow to 0.1% in July, from 0.2% in June, following a shock fall in output from the services' purchasing managers' index (PMI) in the first month after the Brexit vote.

It comes as official figures for the construction industry showed that output flat-lined in July, while manufacturing saw a sharp month-on-month contraction over the period, falling 0.9%.