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CORRECTED-PREVIEW-Euro zone Q1 GDP growth seen at 0.2 pct

(Corrects sixth paragraph to show Italian GDP seen up 0.3 percent, not unchanged) WHAT: Euro zone GDP flash estimate for Q1 WHEN: Wednesday, May 12 at 0900 GMT REUTERS FORECAST: GDP seen growing 0.2 percent in Q1 FACTORS TO WATCH: Growth in the euro zone's economy is likely to have picked up in the first quarter after stagnating at the end of last year, according to a Reuters poll. The poll of 38 economists, surveyed this week, predicted the 16-nation bloc's economy grew a mere 0.2 percent quarter-on-quarter in the first three months of the year. Forecasts for the data, due on May 12, ranged from a contraction of 0.1 percent to growth of 0.6 percent. "Survey data point to an accelerating recovery in the euro area and Germany. But first-quarter growth may have been held back by poor weather conditions at the start of the year," said analysts at Standard Chartered. GDP data from the largest euro zone economy Germany, which is due out earlier on Wednesday, is expected to be flat in the first quarter. France is also due to release data on Wednesday with growth forecast at 0.3 percent, according to the poll. Spain's economy is expected to have grown 0.1 percent in the first quarter, while Italian gross domestic product is expected to have grown by 0.3 percent. That data is also due on Wednesday. The euro zone economy is seen expanding 0.4 percent in the third and fourth quarter of this year, with growth dipping to 0.3 percent in the first quarter of 2011, before returning to a steady 0.4 percent for the rest of next year. The European Central Bank held rates at 1.0 percent at a meeting on Thursday and is not seen shifting rates until early next year as it battles to maintain the bloc's shaky return to growth. MARKET IMPACT: An above consensus reading could spark speculation that the ECB will start tightening policy sooner than expected. A lower reading would suggest the economy remains weak and could fuel expectations that monetary policy will remain loose, giving a boost to fixed-income assets but hitting the euro. (Reporting by Jonathan Cable; Editing by Susan Fenton) Keywords: EUROZONE GDP/PREVIEW (jonathan.cable@thomsonreuters.com; +44 20 7542 4688: Reuters messaging: rm://jonathan.cable.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved.

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