Paulson: Market turmoil to slow U.S. growth

LONDON (CNNMoney.com) -- Treasury Secretary Henry Paulson said the current turmoil in financial markets will slow economic growth but should not spark a recession, according to a report published Thursday.

Paulson told the Wall Street Journal that the turmoil "will extract a penalty on the growth rate" of the U.S. economy, but that "the economy and the markets are strong enough to absorb the losses" without triggering a recession.

Treasury Secretary Henry Paulson expects the current market turmoil will slow U.S. economic growth, but he doesn't see a recession occurring.

Paulson, the former CEO of Goldman Sachs (Charts, Fortune 500), also told the newspaper that some funds or businesses may go under as the markets adjust, but that he expects the U.S. economy to keep growing.

Paulson noted that the turmoil is financial markets is happening "against a backdrop of a very healthy global economy with strong fundamentals," according to the report.