Germany: ''Bundesbank sees sharp economic slowdown''

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"Following a 3.0-percent rise in economic output in the current year, the pace of expansion in Germany is likely to fall perceptibly to 0.6 percent in 2012," the German central bank wrote in its regular monthly report.

That represented a downgrade in the Bundesbank's growth forecast for next year after it had previously been pencilling in economic expansion of 0.75 percent.

The sovereign debt crisis harboured "considerable downside risks," the central bank warned, but added: "Even so, the domestic conditions for an extended, broadly based upswing are still intact."