Germany's GDP shrank in the first quarter of 2009, the fourth contraction in a row. However, despite the country's deep recession, consumer confidence remained stable.
The GDP contraction was the worst since the 1970s
German consumer confidence was unchanged in June, the latest survey by the Nuremberg-based GFK market-research institute said, despite official figures showing a contraction in output of 3.8 percent in the first quarter of 2009.
It was the fourth successive contraction, and the largest since the 1970s. It plants Germany firmly in its deepest recession since World War II.
Consumers in wait-and-see mode
GFK's closely watched barometer of consumer sentiment was stable at 2.5 points, the institute said. It has been virtually unchanged since March as consumers wait to see if Europe's largest economy has indeed hit rock-bottom.
According to the institute, the figures indicate that the country's economic decline may have bottomed out.
"At last the signs are becoming clearer that the rapid decline in the German economy has come to its end and there are hopes of a cautious stabilization this year," the institute said.
The data follow improved business confidence figures on Monday from the Ifo institute and cement the idea that while the worst is probably over for Europe's largest economy, any recovery will be slow and painful.
Export plunge faulted for GDP
According to Germany's Federal Statistics Office, gross domestic product for the export-based economy contracted b y3.8 percent compared to the last three months of 2008. The contraction was due mainly to a plunge in exports of nearly 10 percent.
The German government believes the economy will shrink by six percent this year before creeping back into the black next year with a tiny 0.5 percent growth in output.
Editor: Chuck Penfold