The euro zone economy grew less than forecast in the second quarter, held back by a sluggish performance in Germany and stagnation in France, data from the European statistics agency showed on Tuesday.

The Eurostat agency estimated gross domestic product (GDP) for the 17-country euro zone increased 0.2 percent in the three months to end-June from the previous quarter, compared with economists' forecasts of growth of 0.3 percent.

That was sharply off the rate of 0.8 percent in the first three months of the year.

Compared to the same quarter a year ago, Eurostat estimated GDP growth at 1.7 percent, compared to a year-on-year comparison of 2.5 percent in the first quarter of 2011. Economists had forecast a figure of 1.8 percent for the second quarter.

A major contributor to the slowing growth was a German performance which suffered from a negative trade balance, flagging consumption and weak construction investment.

German growth dropped to 0.1 percent in seasonally adjusted terms, from a revised 1.3 percent in the first three months of the year.

French figures last week showed its economy stagnated in the second quarter.

Germany, Europe's largest economy, has been a star performer since the end of the 2008 financial crisis, and a sharp slowdown in its growth would have knock-on effects in other parts of the euro zone too.

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