Still, it marked a sharp rebound after the German economy barely expanded over the summer.
Year-on-year growth slowed to 1.7% from 1.8% in the third quarter. "Growth drivers will be similar in 2017". "The outlook for the global economy remains subdued".
The ZEW Centre for Economic Research said that its index of German economic sentiment declined by 6.2 points to 10.4 this month in a report on Tuesday.
The Current Conditions Index dropped to 76.4 this month from 77.3 in January, worse than expectations for a reading of 77.2.More news: Girl Scout robbed at gunpoint in Union City
"Political uncertainty regarding Brexit, the future USA economic policy as well as the considerable number of upcoming elections in Europe further depresses expectations", he added.
"Nevertheless, the economic environment in Germany has not significantly worsened", Wambach added.
"Compared with the previous quarter, positive impulses came from domestic activity", the statisticians found, pointing to increased state and household spending and a rise in investment, especially in construction.
While the struggles of the Italian economy in 2016 dragged down the overall growth among the 19 nations in the European Union, the success of the German economy raised the continent's combined GDP after it posted an annual growth rate of 1.9 percent at the end of the year.More news: Eight killed in Kashmir gunfight, protestors clash with security
Higher inflation in Germany than the rest of the 19-nation eurozone has prompted politicians to grumble at the ECB's historic low interest rates and mass bond-buying policy, which they say are hurting savers.
The growth of the inflation rate in the first month of the year was mainly driven by the development of energy prices, which were markedly up by 5.9 percent in January 2017 compared with a year earlier.
"The upshot is that the comparatively high rate of headline inflation in Germany is unlikely to dissuade the European Central Bank from maintaining its asset purchases throughout this year", he said.More news: Flower shops brace for Valentine's Day