The Australian economy grew by 0.6 per cent in the first three months of the year, still resilient albeit below the target expectations of 0.8 per cent. Year-on-year, the country down under grew 2.5 per cent, also slower than expected.

The latest data now prompts doomsday analysis that Australia's mining boom has come to an end.

"The overall tone of the release is pretty soft," Scott Haslem, UBS chief economist, said.

"We saw some improvement in consumer [consumption] and trend improvement in housing, but at this stage. It's not sufficient to offset the pull-back we've seen in [capital expenditure] in this quarter."

"When we take away the net export contribution of about 1 per cent in the quarter, the domestic economy was clearly negative."

Although the increase, however dismal, still managed to extend Australia's 21 years of uninterrupted annual growth, economists expected at least a 2.7 per cent on-year growth spurt.

The data proves the "resilience of the Australian economy" in spite of the continuing challenging global economic conditions, federal Treasurer Wayne Swan said.

"Australia is doing very well compared to many other developed economies," Mr Swan told ABC.

"This also comes at a time when the high dollar continues to bear down on many of our industrial sectors, making the transition towards non-mining sources of growth more difficult."

"Unlike other countries, we face these challenges from a unique position of strength."

A 1 per cent rise in exports and 0.3 per cent jump in household spending helped support Australia's first quarter growth. Still, it failed to offset a sharp drop in government investment.

States' Performance

Economies of the Northern Territory and Western Australia dropped the most being predominantly dependent on mining and resources.

Northern Territory's economy shrank by 10.2 per cent, while Western Australia's by 3.9 per cent. It was likewise the same scenario with Tasmania with its economy dropping by 1.1 per cent and South Australia, which fell by 0.3 per cent.

Saul Eslake, Bank of America Merrill Lynch Australia chief economist, said the economies of the resource-intensive states should not be taken lightly.

"Taken at face value, we've seen state final demand fall in consecutive quarters in three states now - not just Tasmania, where it's fallen for six quarters in a row, but in South Australia for three quarters and perhaps most surprisingly of all, Western Australia has had two consecutive quarters of falling state final demand," Mr Eslake said.

"And although they've probably had increased exports partly to offset that, that sits with the fact that Western Australia's unemployment rate has risen by 1.7 percentage points since July last year."

"So some people might interpret that as saying that the state which has been the engine room of Australia's growth over the last three-and-a-half years has all of a sudden fallen into something that looks a bit like a recession."