The economy has continued to grow, boosted by stronger construction activity.
Official figures show gross domestic product (GDP), which is a broad measure of the health of the economy, expanded 0.7 percent in the three months to March.
Photo: RNZ / Alexander Robertson
That was more than economists had expected, but below the 0.9 percent growth experienced in the December quarter.
Statistics New Zealand national accounts senior manager Gary Dunnet said the growth was driven by the construction and health industries, which more than offset declines in the primary and manufacturing industries.
"The main driver behind the GDP growth was construction, which rose 4.9 percent. This was the strongest quarterly growth for the industry since March 2014," he said.
Manufacturing fell 0.4 percent in the quarter, due to declines in meat processing as concerns about the El Niño weather pattern prompted farmers to sent stock to meatworks for slaughter late last year.
On an annual basis, average growth edged down to 2.4 percent.
And, when comparing activity in the March quarter with the same period a year ago, the pace of growth was 2.8 percent.
The size of the economy in was $249 billion.
Investment spending also up
The pick-up in construction was also reflected in investment levels.
Spending on other construction, which included roads and telecommunications, rose 12 percent - the highest quarterly growth since June 2014.
Investment on housing rose 4.2 percent, led by Auckland and Waikato, while it eased in Canterbury.
Rising demand boosted service industries, which grew 0.8 percent. Health and retail spending led the overall increase.
"We saw a larger population reflected in the rise in health care and consumer spending. When the rising population is taken into account, our GDP per capita rose 0.1 percent on the previous quarter, " Mr Dunnett said.
Surging numbers of tourists also supported growth in services.
Visitor spending rose 4.9 percent in the quarter, and 16.8 percent for the year.
Exports of goods and services edged down 0.1 percent, while imports rose 0.2 percent.
Goods exports fell 3.5 percent, led by dairy and meat products, while export services rose 2.7 percent.
