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Chancellor George Osborne has revealed Britain's economy is forecast to expand at a slower rate than originally expected iStock

The pace of expansion of the UK economy slowed down in the first quarter of 2016, figures released by the Office for National Statistics (ONS) on Wednesday (27 April) showed.

According to the ONS, in the three months to the end of March, the UK's gross domestic product (GDP) grew 0.4% from the previous three months, compared with a 0.6% gain in the quarter but in line with analysts' expectations.

On an annual basis, meanwhile, Britain's GDP grew 2.1% year-on-year, maintaining the pace of growth showed in the final quarter of 2015 and exceeding forecast for a 2.% reading.

On 16 March, during his Budget Speech, Chancellor George Osborne revealed Britain's economy was forecast to expand at a slower rate than originally expected. The UK economy is now expected to grow 2% this year, compared with a previous 2.4% forecast in November 2015.

Speaking on Wednesday, the Chancellor said the figures were good news as they indicated "Britain continues to grow", but warned that "the threat of leaving European Union is weighing on our economy"

However, analysts indicated that many of the factors likely to be to blame for the weakness registered in the first quarter should prove short-lived.

"Uncertainty ahead of the EU referendum in June appears to be taking some toll on economic activity, but it probably does not account for all of the softness," said Ruth Miller, UK economist at Capital Economics.

"Of course, there is still a risk that Brexit jitters will further sap the recovery of its momentum in the second quarter. But even if growth did continue to slow, if the UK voted to stay in the EU, we would probably just see a bounce-back in the third quarter."