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German Economy Contracted in Late 2012

Germany has Europe's most robust economy, but now even its economic fortunes are shrinking in the face of the eurozone recession.

Berlin said Tuesday that its economy contracted one-half of one percent in the last three months of 2012, its biggest downturn in nearly three years. Germany said that cut its economic growth for last year to seven-tenths of a percent.

It expects growth to diminish further – to four-tenths of a percent – in 2013, down from an earlier projection of a one percent advance.

The economy in the 17-nation eurozone contracted in the April-to-September period last year and forecasters say that likely continued in the waning months of 2012. Sharp economic decline in some euro nations – such as in Greece, Spain and Italy – has often been somewhat offset by Germany's powerhouse economy.

But in the fourth quarter last year, German exports, imports and investment slowed, as did consumer spending.

Some information for this report was provided by AP and AFP.