UK growth in the third quarter was propped up by the strongest increase in consumer spending for four years as business investment and the trade position worsened, figures have revealed.

The Office for National Statistics (ONS) confirmed gross domestic product (GDP) grew by 0.7 per cent between July and September, a slow-down from the 0.9 per cent expansion in the second quarter.

It was well ahead of the stuttering eurozone and slumping Japan, but behind the US, which has just revised up its latest growth figures.

The data is likely to revive concerns about the recovery's reliance on households, rather than industry, as Chancellor George Osborne prepares to deliver his Autumn Statement next week.

Consumer spending grew by 0.8 per cent, its strongest pace since the second quarter of 2010, with analysts pointing to improved household confidence and signs that a six-year squeeze on real terms pay is starting to ease.

The services sector, which represents more than three-quarters of output, grew by 0.8 per cent in the quarter, better than previously thought.

However, business investment in the third quarter dropped by 0.7 per cent, its first decline since a similar fall in the second quarter of 2013, amid increasing fears about the impact of global economic woes on the UK outlook.

The trade balance deficit grew from £8.9bn in the second quarter to £11.2bn, as exports continued to drop off at a rate of 0.4 per cent and imports grew by 1.4 per cent.

Chris Williamson, Markit chief economist, said: "The UK'simpressive economic performance was marred by a fall in business investment.

"Falling business investment once again leaves the economic upturn in the hands of the consumer."