Total effects of credit crisis still unseen

Reuters
ECB, Paulson see growth threat
Thursday September 13, 6:09 am ET
By Mike Peacock LONDON (Reuters) - A global credit crisis has increased the threat to growth, the European Central Bank said on Thursday, as G7 governments asked for a report on the genesis of the turmoil for next month's meeting of finance chiefs.

Treasury Secretary Henry Paulson said the U.S. economy would be hurt by the upheaval but the overall outlook remained benign.

"There will be a penalty but the backdrop of the strength of the economy, the corporations, the institutions, is such that we are resilient," Paulson told the Times newspaper.

The ECB's monthly bulletin said global economic activity remained robust, supported mainly by buoyant emerging economies.

But it added: "While the global repercussions of the U.S. economic slowdown have so far been limited, it remains to be seen whether the recent financial market turmoil will lead to a lasting reappraisal of global financial market risks and a loss in confidence with possible implications for the real economy."