Commuters walk through Martin Place in the central business district in Sydney, Australia. Brendon Thorne | Bloomberg | Getty Images

Australia's economic growth boomed past expectations in the first quarter with the annual pace speeding to its fastest in three years, a result that could keep the central bank on hold at its policy meeting next week. Wednesday's data from the Bureau of Statistics showed gross domestic product (GDP) grew 1.1 percent in the three months to March, from the previous quarter when it rose an upwardly revised 0.7 percent. That saw annual growth step up to 3.1 percent, from a downwardly revised 2.9 percent, keeping the economy well on track to meet the Reserve Bank of Australia's (RBA) forecast of 2.5-3.5 percent by June.

The Australian dollar shot up nearly half a U.S. cent after the data showed the nation's economic growth beat expectations, reducing the need for interest rate cuts. "All of the growth in the economy is coming from trade as the third phase of the mining boom kicks in as projects start exporting," said Shane Oliver, chief economist, AMP Capital Investors. "We have had the mining investment boom that's come to an end. Now we are seeing the boom in mining and resource-related exports, that's what is driving this growth."

