VIENNA Feb 15 The euro zone economy may shrink
by around 0.2-0.3 percent as a north-south divide in output
worsens, European Central Bank policymaker Ewald Nowotny told an
"In Europe we have to assume a negative development in 2013
that can be around minus 0.2 or 0.3 percent," he told the
Vorarlberger Nachrichten, citing a "massive economic divergence
between the southern and other countries that could get even
ECB staff projected in December that euro zone economic
output this year would range between a contraction of 0.9
percent and growth of 0.3 percent.
The currency bloc slipped deeper into recession in the last
three months of 2012 after its largest economies, Germany and
France, shrank at the end of a wretched year for the region.
Nowotny, who also heads the Austrian National Bank, said it
may raise its growth forecast for the domestic economy to
0.7-0.9 percent from its most recent outlook of 0.6 percent.