Eurostat's figures, published Wednesday, also showed inflation in the 19-nation single currency group dropping from 1.3 percent in June to 1.1 in July.

This falls even further short of the European Central Bank's 2.0 percent target for a healthy economy, and amounts to further evidence of a worrying slowdown.

The seasonally adjusted unemployment rate nevertheless also fell, from a revised 7.6 percent in May to 7.5 in June, its lowest level in ten years.

The wider 28-member European Union, which includes countries outside the euro, also saw second quarter growth shrink to 0.2 percent, down from 0.5 in the previous period.

All the figures will be subject to revision in the months to come, but they were in line with market expectations as estimated by data firm Factset.

Economist Jack Allen Reynolds of consultancy Capital Economics said the weak data would strengthen the case of the ECB to announce "stimulus measures" at its meeting in September.

Last week, the bank signalled that it could lower its already negative interest rates even lower and bring back its multi-billion-euro quantitative easing programme.

"But while economic weakness had previously been concentrated in Germany and Italy, the national data available so far show that the slowdown in Q2 was broad based," Reynolds said.

Growth is also now softening in France, Spain, Austria and Belgium, he warned.

And even the improved unemployment figure could mask underlying economic weakness, he argued.

"Surveys of firms' hiring intentions suggest that employment growth will lose pace, while other surveys show that labour shortages are easing. So we doubt that wage growth will continue to accelerate," he said.