EU finance ministers have warned that the US economic slowdown and ongoing turbulence on world stock markets will dampen economic growth throughout Europe.

But they also said Europe's economic fundamentals remained strong and downplayed the risk of an economic recession at a finance ministers meeting in Brussels.

"Tensions in financial markets are still there. Our growth rates in 2008 will not be as high as we were expecting in November," said EU Monetary Affairs Commissioner Joaquín Almunia, who called for a "calm and serene" reaction to the current turbulence.

Chairman of the Eurogroup of finance ministers, Luxembourg prime minister Jean-Claude Juncker, said the sell-off on global stock market was partly irrational.

"When financial markets act irrationally, and are driven by herd behaviour, when stock markets demonstrate short-termism, there is no reason for finance ministers to do the same," said Mr Juncker, who stressed that Europe could withstand a US recession.

"The economic situation in the US is in no way comparable with that in Europe or the euro zone," he said. "We feel comfortable with our economic situation at the moment. The economic situation in Europe seems to be uncoupled from the situation in the US." French finance minister Christine Lagarde underlined this point to reporters, noting that just 8 per cent of French exports were destined for the US market. "Even if the United States goes into recession. . . it's not a tragedy in itself," she told reporters at the meeting. The comments from ministers came before the US Federal Reserve slashed its interest rates by 75 basis points in a surprise move that caused stock markets to spike upwards.

European Central Bank president Jean-Claude Trichet and International Monetary Fund boss Dominique Strauss-Kahn attended the finance ministers' regular monthly meetings in Brussels too but did not make any comments.

However, ECB executive board member Jürgen Stark later made calls for calm and composure in an interview on German radio.

"The markets are very nervous. They get new information every day and are very sensitive to it, perhaps excessively so," said Mr Stark.

"This high volatility that we see is certainly not helpful but on the other hand, one should not exaggerate events."