BERLIN, Aug 14 - The risk of weaker-than-expected growth in the 12-nation euro zone economy has increased after data showed Germany, the Netherlands and Italy were all in recession in the second quarter, analysts said on Thursday. The European Statistics Office Eurostat will publish a flash estimate of euro zone second-quarter GDP at 1000 GMT. Analysts polled by last week forecast growth would be flat in the second quarter compared with the first, after rising 0.1 percent in the first three months of this year.
However, some analysts said the second-quarter number could be lower after a bigger-than-expected contraction in Dutch GDP, and weak German and Italian growth data. "The Dutch GDP number was very poor and highlights the risk of a disappointing euro zone GDP number later this morning," said Audrey Childe Freeman, European economist at CIBC World Markets. "Taken together with the soft Italian and German figures, I wouldn't be surprised to see a negative outcome for the euro zone." German data earlier on Thursday showed Europe's largest economy tipped into recession in the second quarter, as the strong euro stifled exports. The euro has gained over seven percent against the dollar this year, hammering euro zone exports by making them more expensive abroad, and exacerbating already weak foreign demand.
The German economy shrank by 0.1 percent in the second quarter having contracted by 0.2 percent in the first, marking its second recession in two years. Data last week showed Italy also slipped into recession in the second quarter. Germany and Italy together account for around half of the euro zone economy. Analysts also expect France to post soft second-quarter growth figures on August 20 due to strikes earlier this year, increasing the risk that the final euro zone growth number will be weak. "We expect fairly poor figures from France, which will have been negatively influenced by strikes...the Dutch are weak, so overall we can consider ourselves lucky if we get zero but it doesn't make too much sense to try to estimate it more exactly at the moment," said Stefan Rieke, an economist at ING-BHF Bank.//