An Etymological Dictionary of the German Language/Annotated/Vetter
Vetter, masculine, ‘cousin,’ from Middle High German vęter, vętere, masculine, ‘father's brother, brother's son,’ Old High German fętiro, faterro, fatureo, masculine, ‘uncle’; for the change of meanings compare Neffe and Oheim. The earlier meaning is ‘father's brother,’ as is indicated by the clear connection with Vater, by Anglo-Saxon fœdera, ‘uncle’ (with faðu, ‘aunt’), and also by the non-Teutonic correspondences which point to Aryan paturyo-, patrwyo-, ‘uncle on the father's side.’ Compare Latin patruus, Greek πάτρως (from *πάτραος), Sanscrit pîtṛvya, Zend tûirya (from *ptûrya), ‘fathers brother.’ In Modern High German dialects Vetter has acquired the signification of Pfetter, ‘sponsor, godfather’ (Middle High German pfętter, equivalent to Italian patrino, see Pate), perhaps by connecting it with Gevatter.