Stand-still in Germany's economy shocks experts

Germany's recovery from recession is far weaker than investors believed, figures showed today.

The EU economic leader's gross domestic product was unchanged in the fourth quarter of last year as falling investment and consumption offset firmer foreign trade, according to the country's Federal Statistics Office.

The figures were far worse than economists expected — the consensus forecast had been for growth of 0.2% in the quarter — and Germany narrowly avoided the double dip recession which would have come with a fall back into economic contraction.

Officials confirmed their previous estimate of the third quarter's growth at 0.7%.

Analysts were also concerned about weak growth in the current quarter.

Joerg Zeuner, economist at VP Bank, said: "The unemployment rate is rising in Germany, the turnaround hasn't been accomplished yet."

Gerd Hassel, of BHF-Bank, said: "The first quarter will probably turn out weak too as the record-breaking cold weather, which is a burden to construction in particular, is dragging on a long time. We no longer have a slump, but rather a very weak recovery."