UPDATE 1-G8 discussed need to contain euro zone contagion-U.S.

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CAMP DAVID, Md. May 19 (Reuters) - Group of Eight leaders stressed in their Saturday discussions the need for European countries to minimize contagion from the euro zone's economic crisis through both fiscal consolidation and growth, a senior White House aide said.

Michael Froman, an official with the National Security Council, said the G8 leaders were not divided over whether to pursue austerity or spending, saying they noted the importance of balancing the two.

"A number of leaders talked about ideas they could pursue in the context of their structural reform and other growth-oriented agendas," Froman said.

Another White House official, Ben Rhodes, said President Barack Obama would hold a bilateral meeting with German Chancellor Angela Merkel at Camp David after the conclusion of the G8 on Saturday afternoon and before Obama heads to Chicago for the NATO summit.

Obama and Merkel also spoke informally on the sidelines of the G8 sessions Friday evening as well as Saturday, Rhodes said. (Reporting By Jeff Mason; Editing by Vicki Allen and Jackie Frank)