Treasurer Wayne Swan says the growth in the Australian economy in the last three months of last year makes Australia the envy of the developed world.
The economy grew at 0.9 per cent in the three months to the end of December, its fastest pace since the March quarter of 2007, the latest quarterly national accounts show.
"These accounts represent a very solid outcome for the economy for an economy which is the envy of the developed world," Mr Swan said.
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The treasurer said the growth was vindication of the government's stimulus measures.
"To have grown the economy in what has been one of the toughest years since the 1930s is a truly remarkable feat and the stimulus is providing a firm foundation for the economy.
"These are very pleasing numbers," Mr Swan said. "They give us cause for optimism."
Mr Swan said private sector demand was starting to pick up as the stimulus was progressively withdrawn, but he admitted the construction sector remained weak.
The Australian Bureau of Statistics (ABS) data showed gross domestic product (GDP) grew 2.7 per cent in the year to December, up from the originally reported 0.6 per cent growth recorded in the 12 months to September.
The quarterly increase was in line with economists' expectations, although the annual rate beat forecasts of 2.4 per cent growth due to revisions to previous quarters.
