LONDON—The U.K. economy grew strongly in the third quarter but its balance of payments with the rest of the world deteriorated sharply, but the Office for National Statistics on Friday confirmed that the U.K. economy expanded 0.8% between the second and third quarters, an annualized rate of 3.2%.The nation's current-account deficit widened to £20.7 billion ($33.89 billion), a shortfall equivalent to 5.1% of overall gross domestic product. That is the widest deficit as a percentage of GDP since 1989. David Kern, chief economist at the British Chambers of Commerce, said the government needs to think of new ways to boost exports to foster a rebalancing. Business investment grew 2% between the second and third quarters, and figures suggest the economy grew faster in 2012 than earlier estimates. The ONS said the U.K. economy is now 2% smaller than it was before recession struck in 2008, not 2.5% as previously thought. The economy also appears to have got off to a good start in the final quarter. Data for October showed the services sector, which accounts for the bulk of U.K. output, expanded 2.1% on a year earlier.
 
LONDON—The U.K. economy grew strongly in the third quarter but its balance of payments with the rest of the world deteriorated sharply, but the Office for National Statistics on Friday confirmed that the U.K. economy expanded 0.8% between the second and third quarters, an annualized rate of 3.2%.The nation's current-account deficit widened to £20.7 billion ($33.89 billion), a shortfall equivalent to 5.1% of overall gross domestic product. That is the widest deficit as a percentage of GDP since 1989. David Kern, chief economist at the British Chambers of Commerce, said the government needs to think of new ways to boost exports to foster a rebalancing. Business investment grew 2% between the second and third quarters, and figures suggest the economy grew faster in 2012 than earlier estimates. The ONS said the U.K. economy is now 2% smaller than it was before recession struck in 2008, not 2.5% as previously thought. The economy also appears to have got off to a good start in the final quarter. Data for October showed the services sector, which accounts for the bulk of U.K. output, expanded 2.1% on a year earlier.
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