THE economy edged ahead just 0.1 per cent in the first quarter this year, new figures have revealed - making an imminent rise in interest rates highly unlikely.

The figure was below economists' expectations of 0.4 per cent and meant that against the same period last year growth was just one per cent less than the 1.3 per cent predicted.

The data, from the Office for National Statistics, showed a small improvement on the final three months of last year, when Britain's economy ground to a halt, recording zero growth after being hit by the manufacturing recession and a lacklustre service sector.

Economists said the weak growth meant a near-term rate rise was off the horizon. Interest rates have been held at four per cent since November and the City has been forecasting a rise to rein back consumer spending and the booming house market.

Simon Rubinsohn, economist at fund manager Gerrard, said: "They are weak figures."

Stripping out the effect of a fall in energy supply, which can be seasonally affected, the underlying picture might not have been quite as weak, he said. There was no strong argument for the Bank of England to increase rates in the next two or three months.

"It is a modest improvement and the underlying picture is probably a little bit better, but even so it is still fairly tentative and doesn't provide any justification for the Bank to move on rates," he said.