The National Institute of Economic and Social Research said Britain's economy grew by 0.7 percent in the last three months of 2013. This is slower than the 0.8 percent recorded in the third quarter but enough to lift full-year growth to 1.9 percent and above the Bank of England's 1.6 percent November forecast.

Britain's economy grew by just 0.3 percent in 2012, and if NIESR's estimate for 2013 is correct, it would be the fastest rate of growth since the start of the financial crisis.

However the economy is still far from recovered, with output still below its peak of early 2008 - in contrast to most other big advanced economies, which are now producing more than before the crisis.

Britain's Office for National Statistics publishes its first estimate of gross domestic product on January 28. NIESR said its estimates were on average within 0.25 percentage points of this.

The research group publishes its GDP estimates each month following the release of ONS industrial output data. Earlier on Friday this showed an unexpected flat level of output, while construction figures recorded a big fall.

This, combined with slow growth in retail sales in December, has caused some economists to slightly revise down forecasts of fourth-quarter GDP growth to a rate similar or just below that forecast by NIESR.

(Reporting by David Milliken Editing by Jeremy Gaunt)