The International Monetary Fund (IMF) has revised down its growth forecast for the UK economy from 2% to 1.7% after a sluggish start to the year.
This is the first time the Washington-based organisation has downgraded UK forecasts since the aftermath of the vote to leave the European Union.
UK GDP grew by just 0.2% in the first quarter of 2017, making it the worst performing major economy.
A Treasury spokesperson said: “This forecast underscores exactly why our plans to increase productivity and ensure we get the very best deal with the EU, are vitally important.
“Employment is at a record high and the deficit is down by three quarters, showing that the fundamentals of our economy are strong.
“We will continue to deliver greater prosperity and higher living standards for hard working people across the country.”
The UK’s growth forecast for 2018 was unchanged at 1.5%, while US growth has been revised down to 2.1% this year and 2.5% next year.
However Germany, France, Italy and Spain saw growth forecasts rise by 1.8%, 1.5%, 1.3% and 3.1% respectively.
The IMF’s World Economic Outlook follows PwC and the Centre for Economics and Business Research (Cebr), who have downgraded UK growth expectations to 1.5% and 1.3% in 2017 respectively.