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Hovnanian CEO Says Risk of Recession Heightened

Hovnanian Enterprises Chief Executive Ara Hovnanian said Thursday the risk of a recession is heightened and called for a rate cut by the Federal Reserve.

"Clearly, the risk of the economy overall going into a recession is heightened right now," the head of the upscale homebuilder said in an interview on CNBC. "The credit market disarray is real."

Hovnanian said that a group of home-builder CEOs were scheduled to meet with Federal Reserve Chairman Ben Bernanke next week.

The cooling U.S. housing market has been hard hit by recent turmoil in the credit markets, which have soured as rising defaults in the subprime sector have caused lenders across the board to tighten standards.

Red Bank, New Jersey-based Hovnanian is one of several homebuilders to have withdrawn its financial forecasts for the year, saying market turmoil made it impossible to offer an accurate prediction.