The average market expectation for GDP growth in the final four months of 2017 was 0.8%, but figures from Statistics New Zealand put growth at 0.6%.
The weaker result was largely because unfavourable weather weighed on agricultural output, offsetting strong services activity.
Capital Economics Australia and New Zealand economist Kate Hickie also said the economy failed to regain any momentum at the end of previous year and with net migration past its peak and business confidence remaining low, the recent strength of consumption and business investment won't be sustained.
"Growth was widespread across many service industries, with business services, and rental hiring and real estate services providing momentum", said Gary Dunnet, national accounts senior manager at StatsNZ. "Retail trade and wholesale trade were also key contributors to growth this quarter".
"We continue to expect the RBNZ to leave the official cash rate on hold until the second half of 2019", said Nick Tuffley, chief economist at ASB.
"Hot, dry weather appeared to have a negative impact this quarter on agriculture production, which fell 2.7%", it said.
Compared to 2016, the economy grew by 2.9%. Falling milk production was reflected in lower dairy manufacturing and dairy exports.
Westpac senior economist Michael Gordon was more downbeat about the economy's performance, predicting the economy expanded by just 0.6% in the final quarter, roughly the speed at which the population is growing.
GDP per capita increased 0.1 percent this quarter, following a 0.2 percent increase in the September 2017 quarter. Growth in the September quarter, previously reported at 0.9%, was revised up to show an increase of 1%.
Household spending was up 1.2%, accounting for $160 billion (56%) of annual GDP.
"Households ate out more and spent more on groceries and alcohol. This fuelled increased retail trade activity, with food and beverage services and supermarkets experiencing growth", it said.
"This was reflected in a 2.1% rise in investment of fixed assets", Dunnet says.
The New Zealand dollar has fallen following the release of the report, trading at.7308 against the United States dollar, a decline of 0.3%.