The UK economy grew at a faster pace than initially thought in the third quarter of the year, according to the latest official figures.

The Office for National Statistics (ONS) said output between July and September was boosted by better growth in services and construction than measured in its earlier readings.

It revised growth to 0.4% from 0.3% – taking the annual rate of growth to 1.1%. Economists had expected no change.

There was a further early Christmas present for the Chancellor.

Separate ONS figures showed the current account deficit – the value of the goods and services imported versus the value of products shipped overseas – shrank to its smallest as a percentage of output since 2012.

STANFORD-LE-HOPE, ENGLAND - JULY 30: Workers walk under the quay cranes at DP World London Gateway Port on July 30, 2013 in Stanford-le-Hope, Essex, England. The port is due to open towards the end of the year, and will be Europe's largest, creating over 27,000 job opportunities and contributing GBP £2.4 billion to the UK economy. (Photo by Dan Kitwood/Getty Images)
Image: Global trade has come under pressure under Donald Trump’s protectionist agenda

The data showed a surge in exported goods meant the gap narrowed to £15.9bn in the third quarter.

The deficit has been seen as an economic risk by the Bank of England for some time – a consequence of the global economic slowdown caused by the US-China trade war but especially Brexit.

More from Business

The latter is related to fears of a fall-off in demand for UK goods without a trade deal with the EU.

The UK is currently slated to leave on 31 January.

The passing of the government’s Withdrawal Bill, being debated in the Commons on Friday and expected to become law early in the new year, gives PM Boris Johnson an 11-month transition period to agree new trading arrangements.

The EU has warned that timetable will be extremely tight.

Brexit and political uncertainty has dragged on demand in the UK economy in the final quarter of the year though economists have said there are strong reasons to suggest the clear election result will release some pent-up demand.

After keeping interest rates steady on Thursday, the Bank of England said it was waiting to see evidence of any ‘Boris bounce’ before deciding whether the economy needed stimulus.

It has forecast growth of 0.1% in the current quarter.