But analysts remained positive over Germany's economy.
"The eurozone growth engine has taken a break in the fourth quarter but it should return soon," Carsten Brzeski, ING bank economist, told the Reuters news agency said.
"Today's numbers, however, were a good reminder that recoveries cannot only be bumpy but also capricious."
Germany went into recession in 2008 as demand for its exports dried up amid the global economic crisis.
After shrinking for four straight quarters, including a 3.5 per cent slump in the first quarter of 2009, the country technically emerged from recession with growth in the second quarter of 2009.
That, in part, helped the 16-nation eurozone to improve economically.
The Federal Statistical Office will release more detailed data for the fourth quarter at the end of February.
Jean-Claude Trichet, the European Central Bank president, has been warning for some time that the recovery in Europe will be "bumpy" and at times "chaotic".
Severe winter weather at the turn of the year may have also affected economic growth. Economists say that could hit GDP in the first quarter but that much of such immediate losses are usually made up in the ensuing months.
Rainer Bruederle, the German economy minister, has said growth in the first quarter of 2010 could be near zero.