German French Economic Outlook Better Than Expected

The German economy shrank less than economists forecast in the fourth quarter, adding to signs it may avoid a recession even as the sovereign debt crisis prompts governments and households across Europe to cut spending. Gross domestic product in Europe’s largest economy, adjusted for seasonal effects, fell 0.2 percent from the third quarter, when it increased 0.6 percent, the Federal Statistics Office in Wiesbaden said today. Economists forecast a 0.3 percent decline, according to the median of 43 estimates in a Bloomberg News survey. Third-quarter growth was revised up from 0.5 percent. The French economy, Europe’s second largest, unexpectedly grew 0.2 percent in the fourth quarter.