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Dow Jones Newswires: U.K. economy unexpectedly expands in November despite persistent cost-of-living pressures

The U.K. economy expanded marginally in November, boosted by the services sector despite high inflation and rising interest rates, but economists expect the country to face a recession at year-end.

The U.K.’s gross domestic product grew 0.1% in November compared with the previous month, slowing from a 0.5% expansion in October, data from the Office for National Statistics showed Friday.

Economists polled by The Wall Street Journal expected the economy to contract 0.2%.

Growth was driven by a stronger-than-expected performance in the services sector, with output in consumer-facing services increasing 0.4% on month, the ONS said. Among them, the largest contribution to growth came from food and beverage service activities in a month where the World Cup started, it said. Industrial production, however, decreased 0.2% weighed by falling manufacturing output.

GDP fell 0.3% in the three months to November, less than the 0.4% contraction in the quarter to October.

The U.K. economy is widely expected to slide to a recession this winter even as lower energy prices have improved somewhat the short-term outlook. GDP is expected to have contracted by 0.3% in the fourth quarter of 2022, and is forecasted to shrink by another 0.3% in the first quarter of 2023, according to a consensus forecast from FactSet.

Write to Xavier Fontdegloria at xavier.fontdegloria@wsj.com

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