(Corrects Bundesbank growth forecast in para 4 to 0.4 pct from
* Prospects for beginning of 2013 improved -Bundesbank
* Business sentiment has noticeably brightened
* Bundesbank sees indications for turnaround in Q1
FRANKFURT, Jan 21 Germany's economic slump
should be short-lived, the Bundesbank said on Monday, adding
that the euro zone's largest economy could have already bottomed
Data last week showed that Europe's economic powerhouse
contracted in the fourth quarter, and might be less of a pillar
of support than believed for the rest of the currency bloc,
where many of its peers are deeply in recession.
The German government cut its growth forecast to 0.4 percent
from 1.0 percent for this year.
The Bundesbank's December forecast also suggested that GDP
would rise by 0.4 percent this year, but added that there would
not be a protracted slowdown.
In the January monthly report, the Bundesbank, Germany's
central bank, used similar language, saying that prospects for
the start of the new year had already improved with business
sentiment brightening noticeably, especially for export
"The broadly stable labour market and increasing employment
prospects indicate that the business cycle weakness will not
last all too long," the German central bank said, adding that
already the first quarter of 2013 showed signs of improvement.
Expected rises in the ZEW investor sentiment index and the
Ifo business climate index for January, due on Tuesday and
Friday, respectively, are seen bolstering such hopes albeit that
they will be judged against relatively low levels
Last week, the German statistics office said that the euro
zone's largest economy contracted 0.5 percent in the fourth
quarter of 2012.
(Reporting by Sakari Suoninen and Eva Kuehnen. Editing by