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2/8/08

Businessweek: EU warns of continued financial turmoil

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EU warns of continued financial turmoil

EU Economic and Monetary Affairs Commissioner Joaquin Almunia told Japanese business leaders Friday in Tokyo that world economic conditions "are particularly challenging this year" adding that financial markets "are set to remain fragile for some time." Almunia's remarks, which were made available by his office, said that problems in credit markets combined with record high commodity prices have intensified concerns that the global economy is in trouble. "Oil and food prices have reached record highs and the U.S. economy is undergoing a pronounced slowdown," Almunia said. "The turmoil in international financial markets is also expected to continue for longer than initially thought."

Almunia said that economic growth in the European Union will be lower than the 2.4 percent and the 2.2 percent for the 15-nation euro-zone forecast made late last year. He said a new indication of the bloc's economic outlook for this year will be released Feb. 21.

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