Berlin - German consumer confidence is holding steady despite Europe's biggest economy being mired in its deepest recession in decades, according to a survey released Tuesday.

The Nuremberg-based GfK marketing group said its forward-looking consumer confidence came in at 2.5 points for June, the same as in for May.

"The indicators have been signalling that the steep contraction of the German economy is bottoming out, giving rise to hopes of reasonable stabilization before the end of the year," the GfK said in a statement.

"At the same time, income expectations dropped back as a result of escalating fears of job losses, concerns which are rising in the wake of increased short-time work and declining income prospects, it said.

The survey was released as Germany's Federal Statistics Office confirmed that gross domestic product (GDP) shrunk by 3.8 per cent in the first quarter of 2009.

It was the fourth successive contraction and the steepest since records were first kept in 1970. (dpa)