Gross Domestic Product (GDP) increased by 0.7%, up from 0.6%, according to the Office for National Statistics (ONS).

The upward revision is mainly due to manufacturing industry having done better than thought.

The ONS cut its estimate for growth in 2016 as a whole to 1.8%, down from the 2% it forecast last month.

This downward revision pushes UK slightly below Germany, with an estimate of 1.9%, in the G7 growth league, said John Hawksworth, chief economist at PwC, "though the difference is well within the margin of error on any such early GDP estimates."

The downward revision appeared to have been prompted by weaker North Sea oil and gas production during the first six months of 2016, and did not reflect the underlying strength of the UK economy, he added.

"Excluding oil and gas output, estimated UK GDP growth might actually have been revised up in 2016," added Mr Hawksworth.

The third revision of the figures will be on 31 March, after the Budget on 8 March.

"Unfortunately, this means that the chancellor won't be able to say that the UK was the fastest-growing G7 economy in 2016 in his upcoming Budget - Germany grew by 1.9%," said Capital Economics UK economist Paul Hollingsworth.

Brexit 'uncertainty'

The ONS also said there had been a slowdown in business investment, which fell by 1% compared with the three months to the end of September.

It attributes that to "subdued growth" in investment in information and communications technology equipment, as well as "other machinery and equipment".

Shilen Shah, a bond strategist at Investec Wealth & Investment, said: "Somewhat disappointingly, business investment fell on the quarter, with hints that Brexit uncertainty is hitting business confidence."

However, the dominant services sector continued to grow steadily, "due in part to continued growth in consumer spending, although retail showed some signs of weakness in the last couple of months of 2016, which has continued into January 2017," according to ONS head of GDP Darren Morgan.

"UK GDP may have gained some momentum into the end of 2016, but recent news from UK seems to have shown that that momentum has been lost in the early weeks of 2017," said Jeremy Cook, chief economist at the international payments company, World First.

"Services growth is set to slow, buffeted by rising inflation and slowing real wage gains and a consumer that is not waving but drowning."

This was a point picked up by Samuel Tombs, chief UK economist at Pantheon Macroeconomics, who tweeted. "UK GDP breakdown shows real household spend up 0.7%, even though employees' compensation grew by just 0.1%. This is not sustainable growth."