"Because construction activity was affected by winter weather even in March, we expect a slight decline in gross domestic product (GDP) in the first quarter," the Bundesbank said in its regular monthly report.
Disappointing new car sales suggest a dip in private consumption, further dragging economic activity down, the bank added.
Throughout most of the early part of the year, Germany was covered in a thick blanket of snow and ice, depressing construction activity and keeping consumers out of the shops.
Nevertheless, the Bundesbank said it expected the upwards trend of the German economy to continue in the second quarter.
The fourth quarter of 2009 had already marked a slowdown in the economy, with gross domestic product (GDP) stagnating after growth of 0.7 percent in the third quarter and 0.4 percent in the second.
The Federal Statistics Office is due to publish a first estimate of first quarter GDP on May 12.
The economy is still recovering from its worst recession in more than 60 years, with GDP shrinking by five percent in 2009.
Berlin expects overall GDP growth of 1.4 percent this year.