Economy 'vulnerable' to shocks: Fed's Rosengren

Economy 'vulnerable' to shocks: Fed's Rosengren

WASHINGTON (MarketWatch) -- The global economy remains "quite vulnerable" to financial shocks, as recent data from the U.S. and China are consistent with a slowdown and it looks like Europe is in a recession, Boston Fed President Eric Rosengren said at a banking forum in Bangkok, Thailand, according to a transcript of his remarks. Rosengren, who isn't a voting member this year on the Federal Open Market Committee, said the vulnerability highlights "why it is particularly important at this time to reduce the probability, and mitigate the severity, of any potential financial shock." A serious financial shock would make it "quite likely" that there would be a large impact on financial and broader stocks that could impact households and businesses on both sides of the Atlantic and cause a significant retrenchment by European financial institutions operating in the U.S. Rosengren says he is more pessimistic than his Fed colleagues, on concerns about the economic and financial conditions in Europe and restrained state and federal government spending.