The British Chambers of Commerce (BCC) has cut its forecast for growth this year and next, forecasting gross domestic product (GDP) to edge up by 0.6% in 2013 and 1.7% in 2014.
It believes the UK will avoid a triple dip recession, with the economy recovering from its 0.3% contraction in the fourth quarter to grow in the first quarter - albeit by a paltry 0.1%.
David Kern, BCC chief economist, said:
We expect quarterly growth to increase very gradually over the next two years, but it will remain modest and below-trend for some time.
In addition, we now expect GDP to return to its pre-recession levels early in 2015 and the squeeze on living standards will continue for a while longer.
More top news
Astronaut who became an internet sensation after posting a video of himself performing a David Bowie classic in space releases album.
Ancient African DNA sequenced for the first time has revealed a huge wave of migration from Eurasia 3,000 years ago.
Pauline Cafferkey, who contracted Ebola whilst working in West Africa last year, has been flown to the Royal Free Hospital in London.