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Germany growth better, France disappoints

German economy - 0.2% growth in Q1
German economy - 0.2% growth in Q1

The German economy, Europe's biggest, grew by a modest 0.2% in the first quarter of 2010, according to official figures. This was, however, better than expectations for zero growth.

The Destatis statistics office also raised its figure for growth in the final three months of 2009 from zero to 0.2% growth. That meant that the full-year 2009 contraction came to 4.9%, rather than 5% as reported earlier.

Read more on euro zone growth in Q1 here

'The German economy is slow in gaining momentum,' the agency noted in a statement, however, following three winter months marked by particularly cold and snowy weather that hampered construction activity.

Exports and investments in industrial equipment had nonetheless provided engines for growth. Data for industrial orders and production in March have also pointed to a solid rebound in that key sector.

Germany suffered its worst post-war recession in 2009, but demand for German goods has picked up amid brighter prospects for the global economy. The government has forecast growth of 1.4% this year.

French growth figures disappoint

Meanwhile, France's statistics agency said its economy shrank by even more than was first feared during last year's historic recession.

INSEE said revised figures show that the worst slowdown since World War II knocked 2.5% off France's gross domestic product in 2009, more than the 2.2% initially estimated.

The French economy grew by only 0.1% in the first quarter of this year, calling into question the government's already modest recovery target of 1.4% growth over the year. INSEE said growth was held back by low consumer confidence, which depressed the domestic household spending that is traditionally a motor of the French economy.

The agency had forecast growth of 0.2% in the first quarter and 0.3% in the second, and it now looks unlikely that this will now be reached.

Separate figures showed that Italy's economy grew by 0.5% in the first quarter of 2010 compared with the last quarter of 2009, when it shrank by 0.1%.