The UK economy remained flat in July, recording no growth for the second consecutive month, and raising expectations for a cut in interest rates.
Economists had expected a 0.2% increase in GDP.
While services output increased by 0.1% during the month, it was insufficient to offset a 0.8% decrease in production output and a 0.4% drop in construction output, according to data from the Office for National Statistics.
The manufacturing sector also recorded a decline, with production falling by 1% after a 1.1% rise in June.
Liz McKeown, director of economic statistics at the ONS, said: “The economy recorded no growth for the second month running, though longer term strength in the services sector meant there was growth over the last three months as a whole.
“July’s monthly services growth was led by computer programmers and health, which recovered from strike action in June. These gains were partially offset by falls for advertising companies, architects and engineers.
“Manufacturing fell, overall, with a particularly poor month for car and machinery firms, while construction also declined.”
The data is likely to strengthen calls among the Bank of England’s Monetary Policy Committee, for more progressive cuts interest rates to stave off a recession.
Chancellor Rachel Reeves said: “I am under no illusion about the scale of the challenge we face and I will be honest with the British people that change will not happen overnight. Two quarters of positive economic growth does not make up for fourteen years of stagnation.”