THE NUMBER of people out of work in Germany has fallen for the first time in nine months. Figures for April show that last month adjusted unemployment fell 62,000 to 3.934 million.

Meanwhile, Bundesbank president Mr Hans Tietmeyer said yesterday that the prospects for economic recovery in Germany were not as bad as sometimes presented.

"The research institutes also express the hope in their spring report that the economy will gain a foothold this year," he said.

Important preconditions for a recovery were in place, he said, noting that neither the current level of interest rates nor the level of liquidity in the economy stood in its way.

"Lending to the private sector is also expansionary. And a few weeks ago we lowered the discount rate to the historic low of 2.5 per cent."

He expected growth in M3 money supply to ease further this year.

The unemployment showed that, on an unadjusted basis, the numbers out work fell to 3.967 million from 4.141 million and the unemployment rate declined to 10.4 per cent from 10.8 per cent.

The number of unemployed in west Germany declined by 17,000 on an adjusted basis and the number of jobless in east Germany fell 44,000.

But the number of vacancies in all Germany climbed to 373,548 from 369,124.

Unemployment has surged in recent months due to slow economic growth and cold winter weather which has hurt jobs, especially in the construction sector.

Federal Labour Office president, Mr Bernhard Jagoda, forecast an improvement in unemployment last week, tipping economists off to what would otherwise have been a surprising decline.

He told a news conference yesterday that unemployment in April fell for seasonal reasons, but the drop only corrected weather related changes of previous months.

"We can see unemployment rose among employees of companies not affected by weather", he said.

Analysts said the figures were in line with expectations and the drop in unemployment probably was not the start of a new trend.