Iran has virtually halted the expansion of its uranium enrichment capacity in the past three months, the UN nuclear agency has said in a report.

The quarterly report by the International Atomic Energy Agency also showed that Iran's stockpile of higher-grade enriched uranium had risen by about 5% to 196kg since August.

But it still remained below the roughly 250kg needed for a bomb if refined further to weapons grade.

Meanwhile, the European Union is to re-impose asset freezes on several Iranian companies, which were annulled this year by court order.

It comes as world powers appear close to a breakthrough deal with Tehran over its contested nuclear programme.

EU diplomats said the move was to re-establish sanctions already imposed, rather than increasing pressure on Iran.

Any new sanctions could risk scuppering a deal that global powers hope to reach with Iran at talks that start next Wednesday.

US President Barack Obama has called on Congress not to impose new sanctions on Iran while the talks are under way.

The EU decision, taken by senior officials today, must still be approved by EU governments later this week, diplomats told Reuters.

Israel 'not impressed' with findings

Israeli Prime Minister Benjamin Netanyahu said he was "not impressed" by the IAEA findings.

He said: "I am not impressed with reports that we hear that Iran has not expanded its nuclear facilities and the reason for that is they don't need to.

"They've got enough facilities, enough centrifuges to develop and to complete the fissile material which is at the core of an atomic bomb," Mr Netanyahu said.

The IAEA report was the first that included developments only since President Hassan Rouhani took office on 3 August.

The IAEA said Iran had installed only four first-generation centrifuges - machines used to refine uranium - at its Natanz plant since August, making a total of 15,240.

In the previous three-month period, May-August, it installed more than 1,800.

Not all of the installed centrifuges are operating.

Mr Rouhani, who succeeded hardliner Mahmoud Ahmadinejad, promised to try to settle the decade-old nuclear dispute and secure an easing of sanctions that have severely damaged Iran's oil-dependent economy.

Iran rejects Western and Israeli accusations that it is seeking nuclear weapons capability, saying it is enriching uranium only for peaceful energy.