There has been “good progress” in talks on a post-Brexit trade deal but the “last stumbling blocks remain”, Michel Barnier said.

The European Union’s lead negotiator has been holding talks with the UK team led by Lord Frost in an effort to reach a late deal before the current arrangements expire at the end of the year.

Mr Barnier briefed European Parliament leaders about the state of the talks, which he said were in the “final stretch”.

He said: “We will only sign a deal protecting EU interests and principles.”

The talks were given the green light to continue on Sunday following a meeting between Boris Johnson and European Commission president Ursula von der Leyen.

But time is running short for a deal to be reached by negotiators, backed by national leaders and then approved by MPs and MEPs.

The House of Commons rises for Christmas at the close of Thursday’s business but MPs have been put on standby to be recalled if a trade deal is secured.

Minister for the Cabinet Office Michael Gove told MPs: “Intensive talks are ongoing with both negotiating teams working day and night to reach a deal.

“We’re going the extra mile in continuing the negotiations to see whether or not an agreement can be reached and we will continue to keep Parliament informed on our progress.”

He added: “Even if sometimes results are coming later than we might have wanted, I know we will be doing everything in order to secure a good free trade agreement in the interests of the whole United Kingdom.”

Mr Gove said if there is a deal “we will request that the House returns in order to make sure that we can legislate effectively, and we believe we can pass the necessary legislation before December 31 to give businesses legal certainty for the future”.

Downing Street said they did not believe it would be necessary to require MPs to sit on Christmas Day.

“Obviously we wouldn’t be looking for the House to sit on Christmas Day and the bank holidays around it. We would obviously try to avoid those days,” the Prime Minister’s official spokesman said.