The pace of economic activity has eased.
Official figures show gross domestic product (GDP), which is a broad measures of the health of the economy, grew 0.7 percent in the three months to June compared with 1 percent growth in the each of the previous two quarters.
Statistics New Zealand said services, which made up two thirds of the economy, increased 1.4 percent, its highest growth in nearly eight years.
The main contribution came from business services, such as advertising, employment services and software development, which rose 4.2 - its highest quarterly rise since late 2001 - while accommodation and food services grew 0.3 percent, its best showing in three years.
That offset a decline in primary industries, which fell 3.1 percent, due to decreases in dairy production, and oil and gas activity.
Construction rose 2.2 percent, led by strong growth on roads and bridges, while a decline in meat product manufacturing led overall manufacturing to fall 0.3 percent.
On an annual basis, the economy grew 3.5, the highest annual growth in seven years.
When comparing activity in the June quarter with the same period a year ago, the economy grew 3.9 percent, which is the highest in nearly a decade.
On the expenditure side of the ledger, GDP grew 0.5 percent.
Household spending, which makes up 60 percent of consumption, rose 1.3 percent, with more demand for used vehicles and audio-visual equipment like televisions.
Investment rose 1.5 percent, while exports fell 2.8 percent and imports rose 2.9 percent.
Domestic economy 'at full steam ahead'
Forecasts for the June quarter ranged from as little as 0.2 percent growth to 1 percent growth, while the Reserve Bank was expecting 0.8 percent growth.
Westpac's chief economist Dominick Stephens said the result was bang-on what his bank was expecting.
"Our forecast was 0.7 (percent), the actual result was 0.7. It really confirms our view that the export oriented sectors of the economy certainly lost altitude in the second quarter of this year. But the domestic economy is really continuing to run at full steam ahead. We are heading back into that two-speed economy-type of environment."
Mr Stephens said the result confirms existing views about the state of the New Zealand economy.
"What we've got is a very big construction boom going on, we've got the service sectors of the economy really steaming ahead - 1.4 pecent growth, which is the strongest since 2006," he said.
"But the export sectors are really stumbling in response to a slowdown in growth in China, which has reduced those log prices, reducing dairy prices and a number of export sectors are struggling or coming off highs really from late last year or earlier this year."
