Chancellor hails 'steady' economic growth despite weakest first-half figures in five years

• Video report by ITV News Correspondent Carl Dinnen

Chancellor Philip Hammond has hailed the economy's "steady performance" despite new figures showing it has been the weakest first half of the year for five years.

Mr Hammond told ITV News he was "proud" at the government's record but "not complacent" after a small growth spurt lifted the UK economy's otherwise sluggish performance in the first six months of 2017.

Gross Domestic Product (GDP) grew 0.3% between the second quarter months of April and June, largely thanks to a rebound from the services sector.

However, the Office for National Statistics (ONS) said the latest figures underline the economy has "experienced a notable showdown" in the first half of 2017.

The chancellor defended the government's stewardship of the economy.

"We've grown for four-and-a-half years now, we've created record levels of employment," he told ITV News Political Correspondent Carl Dinnen.

"So we should be proud of that but we shouldn't be complacent."

He said there was "more we can do" on his key focus, rebuilding growth in productivity, which he said could be achieved by investment in technology, infrastructure and skills.

Mr Hammond also said he "absolutely recognised" the "painful" impending impact on the public from the pound's fall in value.

Shadow chancellor John McDonnell said the latest figures underlined the pressures being put on working families.

"Growth for the first half of 2017 is below expectations, and it follows continued data showing working families are being squeezed with wages not keeping up with prices," he said.

The latest figures were slightly up for the 0.2% growth recorded during the first quarter of the year.

The increase was underpinned by the services sector, the ONS reported, which expanded its output by 0.5%.

Construction and manufacturing industries held back the economy, however, falling by 0.9% and 0.5% respectively for the period.

The brighter second-quarter performance for the services sector was driven in particular by the retail and film industry.

Distribution, hotels and restaurants expanded by 1.1% over the period, while motion pictures grew 8.2%.

Darren Morgan, ONS head of GDP, said: "The economy has experienced a notable slowdown in the first half of this year.

"While services such as retail and film production & distribution showed some improvement in the second quarter, a weaker performance from construction and manufacturing pulled down overall growth."

On an annual basis, GDP grew by 1.7% in the second quarter of 2017, compared with the same period last year, figures showed.