STOCK MARKET WATCH - Wednesday, 11 January 2012

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38. German economy feared to have stalled

http://hosted.ap.org/dynamic/stories/E/EU_GERMANY_ECONOMY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-01-11-09-04-14

BERLIN (AP) -- Germany's economy slipped into reverse in the last quarter of 2011 in spite of showing strong overall growth for the year of 3 percent, the country's Federal Statistics Office said Wednesday.

While the overall 2011 growth figure was as expected by analysts, the statistics office also said that the German economy likely contracted by 0.25 percent in the last quarter of 2011. The exact figure for fourth quarter growth is due only in mid-February and could be revised.

Joerg Kraemer, the chief economist for Commerzbank, expressed little surprise regarding the slowdown and told German news agency dapd he expected the economy to shrink in the first quarter of 2012 as well. That would put it in a recession, technically defined as two consecutive quarters of economic contraction.

Most recent economic indicators suggest 2012 will be a tough year, both for Germany and the rest of Europe.