The Federal Statistics Office on Friday confirmed its initial estimate that German gross domestic product growth slowed 0.1 percentage points to 0.2 percent in the three months to end-September.

The breakdown showed exports supported growth in the third quarter, rising 1.4 percent, while government spending gained 0.4 percent and private consumption was up 0.3 percent.

Germany held up strongly during the first two years of the debt turmoil that has hammered Europe but a slide of a number of the continent's economies into recession and a worsening global outlook has prompted companies to hold off on investments.

The seasonally-adjusted data showed gross capital investment made no contribution to German growth in the third quarter.

"Businesses are investing less in machines and other equipment. The only explanation for that is a crisis of confidence - which means the German economy will lose more speed," said Holger Schmieding of Berenberg Bank.

Chipmaker Infineon (IFXGn.DE) has already said it will cut planned investments.

"The tough savings measures in southern Europe, weaker growth in China and uncertainty over the euro crisis are all contributing factors," said Schmieding.

Economists expect a contraction in the fourth quarter but forecast Germany will avoid a recession - defined as two consecutive quarters of quarter-on-quarter falls in GDP.

German business morale measured by the Ifo index is due at 0900 GMT and is expected to fall for the seventh successive month to the lowest in almost three years in November. Business expectations, however, are seen steady, pointing to a recovery next year.

Data this week showed service providers' expectations were the most downbeat since March 2009 as firms became more worried that clients would slash their budgets next year and that the euro zone crisis would hamper a German recovery.

(Additional reporting by Alexandra Hudson and Stephen Brown; Editing by Stephen Brown and Patrick Graham)

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