The Statistics New Zealand data released yesterday confirmed the economy was subdued in the second half of 2010, although there were reasons to be optimistic about the outlook for the coming year, he said.
The gross domestic product figures for the December quarter reflected slower domestic growth as New Zealanders increased their savings and paid down debt, as well as the significant impact of the first Canterbury earthquake.
GDP increased by 0.2% in the three months to December, leaving annual growth at 1.5% for the year; the highest annual growth for more than two years.
Mr English said that meant the economy had expanded in six of the past seven quarters.
"The economy is making the adjustment it needs to [move] away from excessive borrowing and housing speculation and towards more savings and debt repayment."
It was important the Government played its part in the rebalancing by getting its own finances in order and returning to a budget surplus, Mr English said.
The Finance Minister has spent most of his time since the last election trying to dampen the enthusiasm New Zealanders have for borrowing and spending by encouraging them to save and pay off debt.
Nearly every release by Treasury or Statistics NZ has been accompanied by a warning by Mr English on the need to rebalance the economy towards an export-led recovery.
Yesterday he said there were reasons to be optimistic about growth picking up later this year, despite the devastation and considerable disruption of the earthquake in Christchurch last month.
"New Zealand's commodity export prices remain around record levels, interest rates and inflation are relatively low, the rebuilding of Christchurch will provide a boost to the regional and national economy, and the Rugby World Cup will attract tens of thousands of visitors," Mr English said.
BNZ markets economist Stephen Toplis said the GDP release came and went with little fanfare.
All it did was put an end to the unproductive talk of recession that had become the focus of many, he said.
