It follows 1.2% growth in the second quarter of the year, and is double the 0.4% expected by analysts. Meanwhile rating agency Standard and Poor's upgraded its outlook for the UK's triple-A credit rating.

Chancellor George Osborne called both reports "a vote of confidence in the new government's economic policies".

Government relief

"This is the second major GDP growth surprise in a row and suggests that the UK economy is more resilient than many had feared," said James Knightley, economist at ING.

"The government will no doubt take this as a sign that the private sector can fill the gap created by public sector cuts, but with consumer confidence, hiring intentions surveys and housing activity data all softening we remain cautious." But chancellor George Osborne said that, along with the government's Spending Review announced last week, the ONS data should help underpin confidence in the UK economy.
"The ONS believe that the underlying growth in the third quarter was 'broadly similar' to the strong second quarter," he said.
"This gives me confidence that although global economic conditions remain choppy, a steady recovery is underway."

However, shadow chancellor Alan Johnson claimed the data showed no such thing.

"There's no sign yet of the kind of momentum in the private sector that we need to actually create the 2.5 million jobs that the [Office of Budget Responsibility] is suggesting are necessary, to actually come out of this with increases in employment," he said.

But the government's planned cuts in its Spending Review got a stamp of approval from ratings agency Standard & Poor's, which raised its outlook for the UK's triple-A rating back to "stable" from "negative".

"In our opinion, the decisions reached by the United Kingdom coalition government in its 2010 Spending Review reduce risks to the government's implementation of its June 2010 fiscal consolidation programme," the company said in a statement