By Jan Strupczewski

BRUSSELS (Reuters) - The euro zone economy recorded its first ever contraction in the second quarter, pulled down by falling activity in its biggest economies and raising the risk of a technical recession.

The European Union's statistics office Eurostat on Thursday estimated that the economy of the 15 countries sharing the euro contracted 0.2 percent against the first quarter and grew 1.5 percent year-on- year. Both numbers were as expected.

Eurostat said the quarterly decline was the first since its data series for the euro zone started in 1995. The next weakest result was 0.0 percent growth in the second quarter of 2003.

The fall was still smaller than in the world's second biggest economy Japan, which shrank 0.6 percent in April-June but well below the United States, which expanded 0.5 percent.

"There is a good chance that the economy is already in recession, but even if it isn't the outlook remains for subdued growth in the quarters to come," said Stuart Bennett, senior FX strategist at Calyon.

While the decline was partly a technical reaction to a strong first quarter, when gross domestic product (GDP) grew 0.7 percent from the previous three months, the underlying economic weakness was unmistakable, economists said.

"The strains from the global economic downturn, the surge in oil and commodity prices up until recently, and the euro appreciation have been simply too strong," said Nikolaus Keis, economist at Unicredit.

The European Commission said while risks to growth were to the downside and confidence indicators painted a gloomy picture, using the term recession would be an exaggeration at this stage.