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Euro zone growth held up in Q1

The annual rate of economic growth in the euro zone slowed slightly to 3.1% in the first quarter of 2007, according to official data.

On a quarterly basis, growth economy eased back to 0.6% after hitting 0.9% in the final quarter of 2006, the EU's Eurostat agency said in a first estimate. The figures were hit by an easing in German growth after a rise in VAT on January 1.

But euro zone growth fell by less than expected after hitting a six-year record annual rate of 3.3% in the final three months of 2006.

Eurostat's first snapshot of 2007 growth was slightly better than economists' forecasts for growth of 0.5% for the quarter and 3% over 12 months.