German contraction blow for eurozone

In a worrying sign for the resolution of the eurozone crisis, its biggest economy, Germany, experienced a sharp contraction in economic growth for the last quarter of last year.

A statement released by the German Ministry of Finance yesterday estimated 2012 fourth quarter GDP contracted by 0.5%. Overall, growth last year was forecast at 0.7%, which is considerably below the 3% growth posted in 2011.

Germany is heavily dependent on exports to spur economic growth. But the global economy slowed last year, mainly on the back of concerns about the eurozone, which hit German export numbers.