Bank of Spain says further cuts needed to curb deficit


MADRID, Oct 4 (Reuters) - Bank of Spain Governor Luis MariaLinde said on Friday the government would need to make furtheradjustments to bring the public deficit in line with Europeantargets, and warned it would be difficult in a climate of sloweconomic recovery.

In a speech to the parliamentary budget committee on Fridaymorning, Linde used cautious language to forecast the end ofSpain's second recession since an economic crisis began fiveyears ago. The economy is expected to have expanded slightly inthe July-September period after two years of contraction.

"It is not unjustified to affirm that the Spanish economyseems to be getting over the second recession of this prolongedcrisis," he said in the written copy of the speech distributedby the Bank of Spain.

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