Official figures show that gross domestic product (GDP) was below the 0.2% predicted by analysts, just weeks before the November 26 announcement, at which Rachel Reeves is expected to raise taxes.

The Office for National Statistics reported that production output fell by 2% in September, mainly because of a drop of 28.6% in the manufacturing of cars following a cyber attack at Jaguar Land Rover, which triggered a shutdown. 

AJ Bell head of financial analysis Danni Hewson says: “This latest set of growth figures adds to the immense weight on Rachel Reeves’ shoulders ahead of her second Budget.

“Confidence is crucial, and even sectors that delivered a tiny bit of growth over the summer such as construction and services have seen demand dwindling as many businesses and households decided to press pause on their spending decisions.

“Growth was held up by this government as a panacea – the way to build back public services and pay out more in benefits and wages without the need to increase taxes. 

“But the sums never seemed to add up and the chancellor is now faced with the prospect of breaking manifesto commitments and then trying to foster the confidence needed to deliver growth whilst taking billions out of people’s pockets through tax hikes.”

Evelyn Partners personal finance analyst Alice Haine says: “For consumers, sluggish growth in the third quarter may be worrying. 

“If earnings continue to soften and redundancies rise – as suggested by the latest jobs data, which showed unemployment at a four-year high of 5% – many households could face renewed financial pressure.  

“A weakening jobs market, slowing pay growth and a higher tax burden present a challenging mix for household budgets.

“There is some good news, however. 

“The Bank of England believes inflation has peaked and with growth subdued and the jobs market cooling, there is more scope for an interest rate cut at the Monetary Policy Committee’s December meeting. 

“Five interest rate cuts since August last year have already offered some relief for borrowers, so a sixth cut before Christmas would deliver some welcome festive cheer – particularly if it offsets the gloom of a second tax-heavy Budget.”

Wealth Club investment manager Nicholas Hyett says: “A shrinking economy is not what any chancellor wants days before a Budget. 

“However, in this case it’s the cyberattack on Jaguar Land River that has slammed the brakes on UK economic growth, and without it economic activity would be showing a modest pick up. 

“The massive knock on effects of events at a single company shows how vulnerable the UK economy is at the moment. 

“Not only are large companies at risk from increasing cyberattacks, but the economy as a whole is reliant on a few central employers whose fortunes ripple out across the entire country. 

“Large national champions are great  – but they need to form part of a diverse economic ecosystem and today’s numbers are an excellent example of why the government should be looking hard at supporting small businesses in particular in the Budget. 

“Small companies are any country’s economic engine, and they have the added advantage of not tripping the entire economy when things go wrong.”