The figure was much better than the 0.3 per cent rise economists had expected and pushed last year's full-year growth figure up to 1.6 per cent from the initial estimate of 1.5 per cent the Federal Statistical Office gave last month.
Germany's performance in the October-December period was powered in particular by household spending and investment in equipment and construction, the office said. Exports and imports both rose strongly.
It was the strongest performance since the economy grew by 0.8 per cent in last year's first quarter. That was followed by a contraction of 0.1 per cent and a return to feeble 0.1 per cent growth in the subsequent quarters.
The latest growth figure offers "a clear sign that lower oil prices have found their way into consumers' pockets," ING-DiBa economist Carsten Brzeski said.
Germany "looks set to continue surfing on a wave of economic well-being," he said, with low unemployment, wage increases, low energy prices and low interest rates encouraging spending. "At the same time, the weak euro will definitely benefit German exports."