"The latest gross domestic product result showing the economy grew 0.8 percent in the three months to the end of March is in line with market expectations," Finance Minister Michael Cullen said today.

"Most forecasters had revised up their growth expectations for the March quarter after the release last month of figures showing a surge in residential construction activity.

"The 0.8 percent increase takes growth for the March year to 4.4 percent. This is the largest annual March year rate since 1995," Dr Cullen said.

"But the really good news in the data is that the March growth was led by the export sector. Exports were up 2.1 percent over the quarter while imports were flat, once the distorting effect of the frigate purchase is removed.

"This switch in activity is to be welcomed. The New Zealand economy is dependent on exports. It is simply too small to sustain a recovery fuelled by domestic consumption and tax cuts," Dr Cullen said.

ENDS

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