The European Commission cut its forecast for 2005 euro zone growth to 1.2 pct from its earlier projection of 1.6 pct. The commission said in its quarterly report on the euro area that "projected growth rates for the third and fourth quarters along with the outcome for the first two quarters, would suggest annual GDP growth in 2005 of around 1.2 pct". It said: "This is below the spring forecast of 1.6 pct, mainly as a consequence of weaker-than-expected growth in the first half of the year."