August 23, 2007	Thursday	Sha’aban 9, 1428

BRUSSELS, Aug 22: Recent financial market turmoil does not threaten economic growth in the 13 nations sharing the euro, the chairman of the Eurogroup of eurozone finance ministers, Jean-Claude Juncker, told AFP Wednesday in an interview.

“For the moment, I don’t see a notable risk of impact on growth in the real economy,” he told AFP by telephone from Luxembourg.

After recent violent swings in global financial markets due to concerns of a credit crunch, Juncker said: “We are seeing a situation that is normalising, but we need to remain cautious.” Although the financial market crisis stems mainly from so-called subprime lending for the US housing market, some German and French banks have taken hits due to their exposure to such loans.

But Juncker was confident that the euro banking system could resist and that the impact would not spread to the wider economy.

In reaction to the crisis, major central banks in Europe, the United States and Japan have sought to calm nerves by injecting billions of euros, dollars and yen into their banking system.

For its part, the ECB has in the past fortnight pumped more than 200 billion euros ($271 billion) into the market to maintain liquidity in the wake of the crisis in the US home loan sector that threw world markets into turmoil. — AFP