Victoria's economy is growing faster than it has in more than five years, and is now leading the nation in economic growth, according to the Australian Bureau of Statistics (ABS).

State final demand grew 4.6 per cent over the year to December 2015 which was almost double the 2014 result of 2.4 per cent.

New South Wales came closest with 3.4 per cent for the corresponding period, while the national figure was 1.1 per cent.

The story was same for the December 2015 quarter, with Victoria's growth of 1.2 per cent for the quarter the highest in Australia. Growth was broad-based, with strong growth in household consumption and dwelling investment.

Household consumption was up 1.0 per cent over the quarter – the equal highest of all states – and up 3.4 per cent over the year. Quarterly gains were led by recreation and culture, beverages and food.

The result builds on a series of key economic indicators – including consumer confidence and retail spending – that underline the strength of Victoria's economy.

The ABS also reported that in 2015, Victoria exported more than A$43 billion worth of goods and services in 2015 – the highest in at least four years.

The ABS figures showed Victoria's economy is continuing to surge with goods and services exports totalling A$11.1 billion in the December quarter alone, with particularly strong results in tourism and education.

State final demand is the total amount of goods and services used in the economy by household consumption, business investment, dwelling investment and government expenditure.

Australia's economic growth was a higher-than-expected 0.6 per cent in the December quarter and 3 per cent for the year, according to the ABS.

NAB's senior economist David de Garis told the ABC said the strength of the numbers had caught everyone off-guard, probably including the Reserve Bank.

"Given Australia is going through the biggest mining pullback in our lifetimes, this is a pretty good outcome. Our baseline is that the RBA is done cutting, and these numbers only support that view," he said.

The two biggest contributors to Australia's growth for the quarter were consumer spending, which added 0.5 percentage points, and an increase in inventories, which added 0.2 percentage points.

The biggest drag on the economy came from a continued decline in business investment as the mining construction boom winds down, with capital spending taking 0.2 percentage points off GDP.

Victoria's status as a leading economic powerhouse has been reaffirmed by Moody's triple-A credit rating two weeks ago.

Moody's, which made special mention of the state's strong higher education, tourism and manufacturing sectors, predicted further growth in the Victorian economy this financial year.