Solbes downplays impact of US mortgage troubles

31st August 2007, Comments 0 comments

31 August 2007, MADRID - The crisis in the US mortgage market should have an extremely reduced impact on Spanish financial markets, Economy Minister Pedro Solbes said Friday.

31 August 2007

MADRID - The crisis in the US mortgage market should have an extremely reduced impact on Spanish financial markets, Economy Minister Pedro Solbes said Friday.

"The recent turbulence in global financial markets are taking place within a context of solid economic growth in Spain and the impact on the Spanish financial sector will be extremely reduced," Solbes told a news conference.

Spanish markets have "a high level of transparence, prudence and profitability" and are not comparable to US subprime mortgages, or home loans to people with poor credit records, which have caused turmoil in global markets, he added.

Solbes said there were "indirect risks" however for the Spanish economy from the possible slowdown worldwide as a result of the US housing market woes.

Spain's gross domestic product expanded by 4.0 percent over 12 months in the second quarter, down slightly from an annual rate of growth of 4.1 percent in the previous quarter, the national statistics institute said Wednesday.

The government expects 2007 economic growth to ease to 3.8 percent from 3.9 percent last year.

[Copyright AFP with Expatica

Subject: Spanish news

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