Nov. 18 (Bloomberg) -- Former Federal Reserve Chairman Alan Greenspan said the dollar's decline hasn't affected the global economy and is a ``market phenomenon.''

``So long as the dollar weakness does not create inflation, which is a major concern around the globe for everyone who watches the exchange rate, then I think it's a market phenomenon, which aside from those who travel the world, has no real fundamental economic consequences,'' he said today.

Greenspan's comments come as oil-producing nations in the Gulf region consider revaluing their currencies against the dollar and the Group of 20 calls on emerging Asian economies to loosen their links to the U.S. currency. The dollar fell to a record low of $1.4752 per euro on Nov. 9.

Greenspan also told an audience at the Learning Annex Wealth Expo in New York that outside of the housing industry, the U.S. economy is ``doing reasonably well.''

``If we can get beyond this housing problem I think we'll do pretty well,'' he said.

The worst housing slump in 16 years is taking a toll on the world's largest economy. Sales of previously owned homes fell in September to the lowest level since record-keeping began in 1999, while new-home sales rose from an 11-year low, according to reports last month. Housing starts in September were down 48 percent from their peak in January 2006.

Economists surveyed by Bloomberg in early November forecast the economy would grow at an annual rate of 1.5 percent in the fourth quarter after expanding at a 3.9 percent pace in the previous three months. They forecast 2 percent growth in the first quarter of 2008.

`Fire Sale'

U.S. home builders are ``creating a fire sale'' to reduce stocks of unsold dwellings, Greenspan, 81, said. Housing's impact on the economy will depend on ``how quickly the new home builders are able to liquidate'' unsold homes, he said.

Six Gulf Arab states will discuss a proposal next month to revalue their currencies, Abdul Rahman al-Attiyah, the secretary general of the Gulf Cooperation Council, said today. Saudi Arabia, the biggest member of the group, has no plans to change its exchange rate against the U.S. currency, according to Finance Minister Ibrahim al-Assaf.

The conflicting plans by the Gulf states come as they face record inflation, caused in part by the weakening dollar that has made imports from Europe more expensive.

Also today, the Group of 20 nations, meeting in South Africa, called for ``more flexibility'' in the currencies of emerging Asian nations after European and Canadian officials stepped up pressure on China to reduce its trade surplus with a stronger yuan.

To contact the reporter on this story: Anthony Massucci in New York at amassucc@bloomberg.net.

Last Updated: November 18, 2007 16:18 EST