Eurozone growth more than halved

Analysts expect a rebound later this year

Growth has halved in the 13-nation eurozone between March and June 2007, following weaker investment.The area’s economy grew 2.5% on an annual basis, or 0.3% from to the previous quarter, official data showed.

Analysts said the slowdown – after an expansion of 0.7% in the strong first quarter – had been expected, and was set to be short-lived.

The data fuels the view that the European Central Bank (ECB) will leave interest rates unchanged this week.

The ECB is set to meet on Thursday.

“We had expected that investment would slow down after the very strong first quarter, ” said Aline Schuiling, an economist with Fortis.

“But it’s good to see that household spending rebounded following the VAT (value added tax) hike in Germany.”

Business investment in the region fell 0.2% during the period, after seeing 2% growth in the first three months of the year.