William Dudley, president of the New York Federal Reserve Bank, told lawmakers that deterioration in the European economy could reduce demand for U.S. products.
This would "hurt growth here in the United States and would have a negative impact on U.S. jobs," Dudley said in prepared testimony.
"It is important to recognize that the euro area is the world's second largest economy after the U.S. and an important trading partner for us," he said. "Also, Europe is a significant investor in the U.S. economy, and vice versa. Thus, what happens in Europe has significant implications for our economy."
The European crisis could put more pressure on Wall Street, spreading throughout the U.S. banking system and financial markets.