Gross Domestic Product (GDP) rose 0.8 percent in the December quarter, with manufacturing activity rising a seasonally adjusted 4.5 percent after seven consecutive quarters of decline.
Publishing the data today, Statistics New Zealand (SNZ) said wholesale trade, up 2.7 percent, also rose after seven consecutive quarters of decline, while the category covering retail, accommodation and restaurants gained 1.7 percent.
The GDP rise was in line with the median forecast in a Reuters poll of economists. It follows rises of 0.3 percent in the September quarter and 0.2 percent in the June quarter, which came after five quarters of contraction.
For the year to December, GDP fell 1.6 percent.
Westpac economist Dominick Stephens said the data "looks a lot like the early stages of the recovery we have long been expecting".
"The consumer has made something of a comeback (and) manufacturing did very well. However the key weak spot was the housing market, which had a fairly weak quarter."
Activity in the primary industries as a whole fell a seasonally adjusted 1.3 percent in the December quarter, although agriculture rose 1.1 percent during the quarter as a rise in milk production partly offset a fall in livestock production.
Mining activity fell 7.6 percent, with a fall in exploration activity in the December quarter due to higher than usual exploration activity in the September quarter, SNZ said.
The long period of decline for manufacturing activity means that despite growth in the latest quarter it remains 16.5 percent lower than in the September 2005 quarter, when manufacturing last peaked.
Main contributions to the quarterly rise in manufacturing were a 5.4 percent lift in food, beverage, and tobacco manufacturing, an 8.1 percent rise in metal product manufacturing, and a 6.1 percent gain in petroleum, chemical, plastic, and rubber product manufacturing.
Construction fell 0.6 percent in the December quarter, with a fall in non-residential building partly offset by a rise in residential building, SNZ said.
Activity for the goods-producing industries as a whole -- include manufacturing, electricity, gas and water, and construction -- rose 3 percent in the latest quarter.
For the year to December the goods-producing industries fell 8.2 percent, with manufacturing down 10.4 percent and construction down 8 percent.
For the service industries as a whole, activity rose 0.4 percent in the December quarter and was down 0.9 percent for the December year.
The expenditure on GDP measure also rose 0.8 percent in the three months to the end of December, SNZ said.
Household spending on durable goods rose 1.4 percent in the quarter, with the main increases in retail furniture and major appliances, recreational goods, and used vehicles.
Household spending on non-durable goods rose 1.3 percent during the three months, as spending on alcoholic beverages rose, but was partly offset by a fall in purchases of petroleum products.
Hosuehold spending on services fell 0.5 percent in the December quarter, the largest decline in services since June 2000. The main contributors to the fall were medical and health, life insurance and recreational admission charges.
For the December year, household consumption spending fell 0.6 percent, due to a 3.1 percent fall in durable goods and a 0.1 percent fall in non-durable goods, partly offset by a 0.6 percent rise in services.
