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BlackRock's Mateos y Lago says she is cautious on Europe

STOCKHOLM (Reuters) - A fiscal policy that is constrained and a European Central Bank that is most likely doing too little too late are reasons to be cautious on investing in Europe, BlackRock's deputy head of official institutions group said on Thursday.

A weakening euro zone economy, hurt by global trade tensions, has once again put the spotlight on what European policymakers can do to lift a sluggish economy.

"If the U.S. gets hit by a shock, the Fed will cut interest rates, we will have extra fiscal stimulus. But look at the euro area, the ECB is doing what it can, but will it be able to do a whole lot more? No," BlackRock's Isabelle Mateos y Lago said at the International Capital Markets Association conference in Stockholm.

"The ECB policy reaction at best is probably too little too late, the fiscal reaction is constrained by rules in place, and this is the reason to be cautious on Europe," she said.

(Reporting by Virginia Furness; Writing by Dhara Ranasinghe; Editing by Tommy Wilkes)