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Weak Q1 euro zone growth confirmed

Euro zone economy - Irish GDP growth topped list in first quarter
Euro zone economy - Irish GDP growth topped list in first quarter

Official figures show that the euro zone economy grew by just 0.2% in the first quarter of this year, amid tough spending cuts across the single currency area.

Growth across the wider 27-nation EU, which includes Britain and Poland, was also 0.2% between January and March compared with the previous quarter, according to the Eurostat agency.

On an annual basis, the euro zone economy grew by 0.6% in the first quarter. The figures confirm previous Eurostat estimates.

Ireland, one of the EU members undergoing deep budget cuts to tackle a runaway public deficit, posted the highest growth rate compared with output in the previous quarter as its economy grew by 2.7%.

This was GDP growth, however, which includes foreign multi-national profits. GNP, considered a better measure by many economists, fell in the first quarter.

Surprise drop in German industry orders

Separate figures showed that orders placed with German industry, a pivotal exporting force in the euro zone, fell unexpectedly in May by 0.5%.

The fall from the level the previous month,, reported by the economy ministry, spotlights the risk of a "double dip" recession in the euro zone amidst tough austerity drives by governments to correct public finances. Analysts had expected an increase.

The economy ministry revised the April figure higher, however, to an increase of 3.2% from March.