LONDON (Reuters) - Britain’s public finances showed a smaller-than-expected budget surplus in the first month after the vote to leave the European Union, potentially limiting the ability of new Chancellor Philip Hammond to give the economy a big boost later this year.

Britain ran a budget surplus - excluding state-owned banks - of nearly 1 billion pounds last month, lower than the almost 1.2 billion pounds in the same month last year, leaving it off track to meet its current fiscal targets.

Economists in a Reuters poll had expected revenues to exceed spending by 1.6 billion pounds.

Samuel Tombs, an economist with Pantheon Macroeconomics, said tax revenues grew below the projections that underpin Britain’s current budget plans for a fourth month, leaving little wiggle room for Hammond to spend more or cut taxes.

“July’s relatively small surplus means that the Chancellor will be able to put together only a modest package of measures to support the economy in the Autumn Statement later this year,” Tombs said in an email to clients.

Hammond has said he will move more slowly to turn the deficit into a surplus than his predecessor George Osborne and might “reset” fiscal policy at the end of 2016, depending on how the economy copes with an expected “Brexit” slowdown.

Official figures released earlier this week showed no impact on consumer demand from the vote to leave the EU and little hit to the labour market in July. But economists say it remains too early to gauge the longer-term effect of the vote.

A bus carries commuters as it travels over Waterloo Bridge in London, Britain June 24, 2016. REUTERS/Toby Melville

HELP FOR ECONOMY

Britain’s future relationship with its main trading partners in the EU is unlikely to be clear until 2019 at the earliest.

Martin Beck, senior economic advisor to the EY ITEM Club, still expected Hammond would provide some help to the economy. “Some form of fiscal stimulus to support the economy in the face of Brexit-related worries seems almost certain,” he said.

Britain typically reports a surplus in July as companies pay corporation tax and some individuals settle their tax returns.

Corporation tax receipts of 7.5 billion pounds were the strongest for July since 2011, the Office for National Statistics said on Friday. But weighing on the budget figures were weaker growth in individual income tax payments than in July last and lower revenues from tobacco tax.

An ONS official said the fluctuations could be due to differences in when the taxes are paid from year to year.

The ONS said its data included forecasts and so any post-referendum impact might not be clear for some time.

For the first four months of the 2016/17 tax year, public sector net borrowing of 23.7 billion pounds was 11.3 percent lower than last year, less than half the kind of reduction needed to meet Britain’s existing budget plans.

Osborne failed to meet his target for cutting the deficit last financial year when it stood at 4.0 percent of gross domestic product, down from over 10 percent in 2010 but still among the highest for a developed nation.

Before the referendum, Britain’s finance ministry said the economic shock of a vote for Brexit could increase public sector net borrowing by 24 billion pounds in the 2017/18 tax year. In the case of a severe shock, it could rise by 39 billion pounds.