I think we have enough of a sense of humour to live with it

Katja Banik Bild Zeitung

"These terms are rather silly. They indicate a use of stereotypes that can be improved upon," he said, indicating the absurdity of tagging a nationality with the name of a food which - in any case - most Germans rarely eat.

Is Mr Hancker just confirming another stereotype about Germans - their supposed humourlessness - in his unamused reaction? Or is it time for the British to realise that calling their fellow Europeans after their national dishes is as offensive as any other racist jibe?

Julia Hoener, a student in the north German town of Hildesheim, thinks it is "totally OK" to call her countrymen Krauts. "It's just based on a kind of ironic jest. Nowadays it doesn't smack of anything negative".

Soenke Faltien, a German photographer who recently moved to London, disagrees.

The advertising watchdog said the advert was light-hearted

"It's not just a name, it's an insult. It shows a lack of respect and is a joke at other people's expense," he says.

Katja Banik, a correspondent for Bild Zeitung - Germany's leading national tabloid - takes the middle ground between Ms Hoener and Mr Faltien.

"It's not something you like hearing, but it's not earth shattering," says the journalist, who has lived in London for the past six and a half years.

Island monkeys

"I think we have enough of a sense of humour to live with it," she says.

Humour, perhaps, but Germans would certainly not make similar "jokes" about the Brits.

Ms Banik finds it "inconceivable" that her paper could publish a headline including the words "Tommy" or "Inselaffe" (Island monkeys) - German nicknames for Brits.

Many of the UK tabloids have no such qualms.

Ahead of the last month's match between England and Germany, they whipped up support with a frenzy of anti-German jingoism.

I'm surprised how common such name-calling is - and how commonly accepted it is

Soenke Faltien

"Shove your beach towels up your a***" was the headline in the Daily Sport, while the Daily Mail showed photographs from 1935 depicting the German team giving the Nazi salute.

"British people seem unaware that, outside the Balkans, in no other European nation but their own would xenophobic insults be considered fit for publication in a mainstream newspaper," wrote the Observer's John Hooper from Berlin, the day after the match.

Sticks and stones

But anti-German feelings are not confined to the papers. They appear to spill over into daily life - to the extent that people have felt pushed to pursue legal action.

The word Kraut does not give a comprehensive picture of a nationality - it says more about the person who uses it

Julia Hoener

The UK's Commission for Racial Equality (CRE) has received 10 applications in the last six years for help in cases relating to direct of indirect anti-German discrimination.

"Anti-German discrimination is probably more widespread than these figures would suggest," said a spokeswoman for the commission. She thinks that foreign nationals are often unaware of their rights and the CRE's image as a body to help black and Asian people deters them from turning to the commission for help.

But for many Germans the jibes say more about the name-caller than about its subject.

"I'm surprised how common (such name-calling) is - and how commonly accepted it is," Mr Faltien says. "It's a 50-year-old name - it's the people who say it who make fools out of themselves".

Ms Hoener agrees: The word Kraut "does not give a comprehensive picture of a nationality - it says more about the person who uses it".

Germans have been schooled by the heavy burden of their history to show respect and sensitivity towards others. And even despite the new lease of national confidence gained since reunification, most Germans - particularly the educated and middle classes - are loathe to stand up for their country.

But, at least some of the reaction to the watchdog's ruling suggests that they may no longer be prepared to be on the receiving end of xenophobic insults.

The Brits may find the joke is on them.