The UK economy is set for a 'robust' pace of growth for the rest of the year, a business group has predicted, even though performance eased to a six-month low in the three months to June.
The CBI said that lower oil prices and low inflation would continue to boost real incomes and consumer spending, although exports would remain under pressure from the strength of the pound against the euro and weak global export markets.
It also said that a possible Greek exit from the eurozone posed the most immediate risk to the UK outlook in terms of financial and exchange rate volatility, although the UK's direct exposure to Greece was small.
'Should a Greek exit lead to contagion, this could result in renewed capital ﬂight from other periphery states, a reversal in improved credit conditions across the Eurozone and further depreciation in the Euro (with direct consequences for UK exporters),' the report states.
The rate of economic growth fell in June, largely because of a slowdown in business and professional services after they recorded the fastest pace of growth in over nine years in May, according to the CBI's survey of 750 firms in the manufacturing, distribution, consumer, business & professional services sectors.
Manufacturing output improved 'a little' in June but growth in the sector remained 'moderate', the CBI said.
Meanwhile, retailers saw a robust rise in sales volumes in the year to June - although on a monthly basis they were slightly down - and expect a similar pace of growth next month.
Sales volumes in both wholesale and motor trades grew strongly in the year to June and ahead of expectations.
The survey comes as Markit suggested that the UK economy was likely to have accelerated in the second quarter after the dominant services sector expanded more than expected in June.
The latest Markit/CIPS services purchasing managers' index rose to 58.5 in June after dipping to a five-month low of 56.5 in May from an eight-month high of 59.5 in April. A reading above 50 indicates growth.
Activity among services firms, which include marketing and recruitment companies as well as restaurants and hotels, increased in June despite slightly lower levels of new work and employment.
Markit said the data pointed to economic growth of 0.5 per cent in the second quarter, up from 0.4 per cent in the first three months of the year.
But it warned that weakness in the manufacturing sector meant that industrial production was likely to have declined in the second quarter, leaving the economy dependent on the service sector and household spending to sustain any growth.
Last month the CBI cut the UK's growth forecast for 2015 to 2.4 per cent from 2.7 per cent as it warned that as it warned that the EU referendum in Britain and a 'messy' resolution of the Greek crisis pose further risks to the economic outlook.
It also cut its GDP growth forecast for next year from 2.6 per cent to 2.5 per cent. The downgrade followed those by the OECD and the British Chamber of Commerce, with both organisations having cut their growth forecasts for this year to 2.4 per cent and 2.3 per cent respectively.