The Government has surprised economists by borrowing a less-than-expected £7.8 billion in the month of the EU referendum result.
The Office for National Statistics said public sector net borrowing excluding public sector banks dropped £2.2 billion in June, compared with the same month last year, with economists pencilling in a figure of £9.5 billion.
The ONS said public sector net debt excluding banks climbed by £47.6 billion to £1,620.7 billion over the period, the equivalent to 84% of gross domestic product (GDP).
Chancellor Philip Hammond said: "These public finance figures highlight the underlying strength of the British economy. Ahead of the referendum monthly borrowing continued to fall, with the deficit in June the lowest it has been since 2007.
"As our economy now adjusts to reflect the referendum decision it is clear we will do so from a position of economic strength."
It means that in the financial year to date, the Government has borrowed £25.6 billion, a fall of more than 8% or £2.3 billion compared with the same period last year, the ONS said.
The new Government has scrapped previous chancellor George Osborne's target of returning the public finances to a surplus by 2020.
Mr Osborne had been looking to hit forecasts set by the Office for Budget Responsibility, which said the UK would have a budget surplus of £10.4 billion in 2019/20 and £11 billion the year after.
However, Mr Hammond has indicated that the Government may take advantage of the cheap cost of borrowing to push fresh investment into the UK in the hope of bolstering productivity.
The ONS said the Government's coffers were helped by a £2 billion rise in receipts to £49 billion in June, compared with the same month last year.
But this was swallowed up after a £700 million rise in Government expenditure to £58.5 billion over the period.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: "The trend in the public finances improved in June, albeit not by enough to make up for the bad start to the fiscal year.
"Borrowing was 22% lower than in June 2015, in line with the 23% year-over-year reduction the OBR anticipated in the March Budget for the full year."
He added: "The overall picture remains that progress in repairing the public finances has been disappointingly slow.
"The Government is estimated to have borrowed £75.3 billion in 2015/16, exceeding the OBR's forecast by £3 billion.
"Meanwhile, overshoots in April and May mean that borrowing in the first three months of 2016/17 has been only 8.3% lower than in the previous year. Borrowing therefore is on course to overshoot the OBR's forecast of £55.5 billion by around £14 billion."