Feb. 28 (Bloomberg) -- President George W. Bush said today there is ``no question'' the economy is slowing, while rejecting suggestions that the nation is on the brink of a recession.

``I'm concerned about the economy because I'm concerned about working Americans,'' the president said at a news conference today at the White House. ``I don't think we're headed to a recession.''

He also urged Congress to quickly pass legislation to help homeowners avoid foreclosure and not act on measures that would rescue lenders and property speculators.

The slowing economy and a crisis in the housing market has overtaken the Iraq war as the main concern of voters in the U.S. with the campaign to succeed Bush under way. A gloomy economic outlook, if it continues through November, may hurt Bush's fellow Republicans in the races for president and Congress.

Economists surveyed by Bloomberg News earlier this month put the chance of the U.S. entering a recession at 50-50, up from 40 percent odds a month earlier. In addition, government reports indicate that the U.S. expansion, now in its seventh year, is in peril.

The Commerce Department reported today that the economy in the fourth quarter grew at an annual rate of 0.6 percent, less than forecast and reflecting reduced estimates for spending and construction. A separate showed initial claims for unemployment insurance climbed 19,000 last week to 373,000, higher than forecast.

Time to Work

Bush said he wants to give the $168 billion stimulus plan his administration worked out with lawmakers time to take effect before trying to pass a second such measure.

``We acted robustly and now it's time to determine whether or not this pro-growth package will actually work,'' he said.

The president said his administration continues to support a strong dollar policy and that the currency's value will be reflected as the U.S. economy grows.

The dollar fell to a record low against the euro for a third straight day. The U.S. currency touched $1.5151 per euro, the weakest since the euro's 1999 inception.

``We believe in a strong dollar policy, and we believe, I believe, our economy's got the fundamentals in place to grow,'' Bush said. ``The value of the dollar will be reflected in the ability for our economy'' to keep growing.

Responding to criticism of the North American Free Trade Agreement by Democratic presidential candidates Barack Obama, an Illinois senator, and Hillary Clinton, a New York senator, Bush said ``it's in the interests'' of the U.S. to pursue free trade.

Free Trade `Essential'

``I firmly believe that free trade is essential to the formation of high-paying, quality jobs,'' Bush said.

Obama and Clinton this week said they would threaten to withdraw from the accord with Canada and Mexico if it isn't renegotiated to include labor and environmental standards intended to protect U.S. workers.

``The idea of just unilaterally withdrawing from a trade treaty'' for politics ``is not good policy,'' Bush said.

On the crisis in the housing market, Bush reiterated that he wants Congress to pass measures that would enhance the role of the Federal Housing Administration, an agency that insures mortgages, and toughen oversight of Freddie Mac and Fannie Mae, the largest sources of home financing in the U.S.

``Congress should move ahead with responsible legislation to modernize'' the three, Bush said.

The administration also backs a measure that would expand tax-exempt state bond programs to provide for mortgage refinancing.

Legislation

Earlier this week, the Bush administration signaled it will veto foreclosure-prevention legislation Senate Democrats aim to advance that includes a provision that would let judges modify mortgages in bankruptcy proceedings.

``The Senate is considering legislation that would do more to bail out lenders and speculators'' than help Americans stay in their homes, he said.

Bush also pressed Congress to ``fully fund'' U.S. military operations in Iraq and accused Democratic lawmakers of ignoring the success of his current policy.

``The same people who once accused me of refusing to acknowledge setbacks in Iraq now are the ones who are refusing to acknowledge progress in Iraq,'' Bush said.

On international affairs, Bush said in response to a question that good relations with Russia are ``important for stability'' in the world.

He said he would advise his successor ``to establish a personal relationship'' with whomever is the leader of Russia.

Bush also said nothing has changed in Cuba, now that Fidel Castro has stepped down, to change U.S. policy to the Caribbean nation.

``Now is not the time to talk to Raul Castro,'' Bush said, adding that Castro is an extension of his brother's regime.

To contact the reporter on this story: Edwin Chen in Washington at echen32@bloomberg.net; Holly Rosenkrantz in Washington at hrosenkrantz@bloomberg.net.

Last Updated: February 28, 2008 13:30 EST