SYDNEY (AFP) - Australian growth slowed to 0.5 percent in the March quarter despite the withdrawal of large-scale stimulus spending, official figures showed, raising hopes the recovery is self-sustaining. Treasurer Wayne Swan called the data, including 2.7pc expansion in the 12 months to March, a solid outcome that reflected Australias performance as the only advanced economy to defy recession during the global downturn. Australians should have great confidence in the fact that we have another very solid outcome for an economy which continues to be one of the best in the developed world, he told reporters. This is more evidence that we got in and we did what was necessary during the global recession and we now are seeing the fruits of that again. The Australian Bureau of Statistics said GDP was up 0.5 percent quarter on quarter, underpinned by an 11.6 percent jump in public investment and 0.6 percent growth in household spending. The economy expanded 2.7 percent over the 12 months to March 2010, while growth for the December quarter was revised up from 0.9pc to 1.1pc. Government spending on buildings and infrastructure part of a $50b stimulus was the main growth driver, adding 0.7 percentage points over the quarter. But growth slowed overall, dropping from 1.1 percent in the December quarter and 0.6 percent in the same period last year, following the un winding of stimulus and a series of rate hikes. Weve had a far shallower downturn than major advanced economies and were recovering from a position of strength, said Swan. Unlike many other economies we are not wading through the rubble of capital destruction, small-business closures and prolonged and high unemployment as we set about building for the future. Swan said the withdrawal of stimulus subtracted about 0.10 percentage points from quarterly growth, but the data showed tentative signs that a self-sustaining private sector recovery is in prospect. He also pointed to a 4.2 percent rise in resource-rich Australias terms of trade in the quarter. With demand for commodities accelerating and export prices expected to continue to rise, the prospects for exports are very positive, Swan said. Analysts said the growth slowdown was not as sharp as feared, and noted that the underlying fundamentals looked strong. On an annual basis, it still looks pretty good, said AMP economist Shane Oliver. My feeling is well see consumer spending pick up in the second quarter, dwelling activity will pick up and so will business investment, and that should push GDP back up to 0.8 percent to 0.9 percent growth. UBS economist Scott Haslem said rising terms of trade and domestic incomes meant the most reasonable central case seems to be further strengthening in growth through the year as the private sector gathers much greater momentum. Australias central bank this week held interest rates at 4.50 percent, pausing an aggressive series of hikes since it became the first advanced economy to shift away from stimulatory settings in October. Instead of contracting 0.5 percent as forecast in last years budget, Australias economy grew 2.0 percent in 2009-10 and Swan flagged a powerful rebound in growth to 3.25 percent in 2010-11 in last months annual budget. Swan then said GDP would hit 4.0 percent in 2011-12, as Australia defied global economic gravity to outperform the worlds major economies. He said Australias resilience, thanks to Asian resource exports and the stimulus spending, meant it would be debt-free by 2012-13 three years earlier than expected. Australian stocks rallied on the news, with the S&P/ASX200 up 0.21 percent.