BERLIN: The German government will raise its growth rate forecast for 2010 from 1.2 percent to 1.5 percent in its annual economic report, according to the weekly Der Spiegel.

Unemployment should also stay below the four million threshold, the weekly said, quoting the report to be presented by Economy Minister Rainer Bruederle on January 27.

Europe's biggest economy suffered its worst post-war recession last year, contracting by five percent in the global slump, official figures showed on Wednesday.

Amid the gloom, however, employment held up much better than expected and the public deficit was much less than feared, despite additional government spending to soften the blow from the sharpest global downturn since the 1930s.

Germany releases fourth-quarter and final 2009 gross domestic product figures on February 12.

This year, the finance ministry expects the deficit to exceed 5.0 percent as the government spurs the economy with more stimulus measures in an effort to get it back on track.

The country's export-oriented economy was slammed by the global slowdown but should benefit from fresh emerging market demand for capital goods such as machine tools and motor vehicles needed for their own output.

Bruederle was upbeat Wednesday, saying the worst was over.

Unemployment has been limited by Germany's short-time schemes under which the state subsidises shorter hours for workers to avoid widespread layoffs.

The number of jobless is still likely to reach more than 3.8 million this year, after averaging 3.42 million, or 8.2 percent of the workforce, in 2009, experts say.