EU finmins - no recession here, no need to follow Fed

By Jan Strupczewski and Huw Jones

BRUSSELS (Reuters) - European finance ministers sought to distance themselves on Tuesday from the United States' economic problems, saying Europe need not emulate a deep rate cut to avoid recession because it had strong fundamentals.

The U.S. Federal Reserve on Tuesday slashed its benchmark interest rates by 75 basis points in a bid to alleviate fears of a recession in the world's biggest economy.

The surprise move reversed earlier steep losses in European stocks, with Britain's FTSE 100 closing up 2.9 percent and the FTSEurofirst 300 also ending higher.

"We don't need to imitate all the decisions other economies can adopt. We need to rely on our own framework that is much more efficient," Economic and Monetary Affairs Commissioner Joaquin Almunia said at the European Parliament.

"The U.S. economy has serious problems with fundamentals. We haven't," he added.

He also said he did not expect a recession in the United States but rather a pronounced slowdown and that the Fed move had not altered his view.

His comments helped boost the euro by more than half a cent against the dollar to $1.4643.

Italian Economy Minister Tommaso Padoa-Schioppa was reticent about the impact of the deeper-than-expected Fed cut.

"I don't think the events of the last 24 hours change fundamentally the assessment ... that a correction is under way, a correction to important imbalances," he said.

Fears of a U.S. recession on Monday sparked a share rout that generated the biggest one-day drop since the attacks of September 11, 2001.

The chairman of the euro zone finance ministers, Luxembourg Prime Minister Jean-Claude Juncker, said the sell-off was partly irrational, while Spanish Economy Minister Pedro Solbes said everyone was concerned by the direction of markets.

"When financial markets act irrationally, and are driven by herd behavior, when stock markets demonstrate short-termism, there is no reason for finance ministers to do the same," Juncker told reporters on arriving for Tuesday's talks.

LIMITED IMPACT ON EUROPE

Other EU ministers sought to play down the impact on Europe.

"Even if the United States goes into recession ... it's not a tragedy in itself," French Economy Minister Christine Lagarde said. She urged calm despite what she called a brutal correction in markets, with Asian shares having skidded lower on Tuesday.