Moody : analyst says Portugal still needs significant fiscal consolidation

LISBON (Reuters) - Portugal still needs significant fiscal consolidation to reduce its large debts and the country's banking system is not strong enough to support economic recovery, rating agency Moody's vice-president of sovereign ratings Kathrin Muehlbronner said on Wednesday.

"We still see significant economic and fiscal challenges for Portugal," Muehlbronner told a conference in Lisbon. "In our view the Portuguese government still needs significant fiscal consolidation, and fiscal consolidation in structural terms, in order to bring the debt down."

She said Portugal's growth outlook remains weak and the banking system is not "strong enough to support the recovery."

(Reporting By Shrikesh Laxmidas, writing by Axel Bugge)