The UK economy suffered only a slight slowdown in the three months after the Brexit vote and carmaker Nissan said it would build more cars in the country, assuaging fears over the immediate economic impact of the decision to leave the EU.
With the upbeat growth figures published on Thursday, the likelihood of the Bank of England cutting rates as early next week has reduced, say commentators.
The development had, meanwhile, prompted investors to sell UK government bonds.
However, finance minister Philip Hammond in a cautious note said he still planned to provide support for the economy as the country launched tough negotiations with the EU next year.
"I think it is right that we still prepare to support the economy during the coming period to make sure that we get through this period of uncertainty," said Hammond, who would announce his first budget plans next month.
According to official data, the economy grew by 0.5 per cent between July and September, which was slower than the strong growth of 0.7 per cent seen in the second quarter but comfortably above a median forecast of 0.3 per cent in a Reuters poll of economists.
Sterling was up to a one-week high against the US dollar after the data, and the yield on 10-year government bonds hit its highest level since the EU membership referendum.
According to commentators, the expansion also disproved the Treasury's referendum campaign claim that a vote to leave the EU would result in 0.1 per cent fall in GDP in the third quarter that would herald the start of a recession.
The Treasury had also projected a worst-case ''severe shock'' scenario which predicted a 1 per cent fall in the three-month period.
The dominant services sector registered a 0.8 per cent growth in the third quarter, but the other major sectors all contracted – with construction falling 1.4 per cent, agriculture by 0.7 per cent, and production - which includes industries such as mining and waste management - by 0.4 per cent.