Euro zone Q3 GDP shrinks, but employment rises

BRUSSELS, Nov 14 (Reuters): The euro zone economy contracted marginally quarter-on-quarter in the third quarter, a new estimate confirmed on Tuesday underlining expectations of a technical recession if the fourth quarter turns out equally weak, but employment still rose.

The European Union's statistics office Eurostat confirmed its estimate from Oct 31 that gross domestic product in the 20 countries sharing the euro fell 0.1 per cent quarter-on-quarter in the July-September period for a 0.1 per cent year-on-year rise.

European Central Bank vice president Luis de Guindos said last week the euro zone economy was likely to contract slightly or at best stagnate in the fourth quarter after business activity data for October showed further weakening of demand in the dominant services industry. But contrary to the usual trend when the economy weakens, employment in the euro zone rose 0.3 per cent quarter-on-quarter in the same period, for a 1.4 per cent year-on-year increase.