It was unlikely the debt crisis in Europe would lead to a "worldwide recessionary shock," St. Louis Federal Reserve President James Bullard said on Tuesday.

"There are several reasons why this new threat to global recovery will fall short of becoming a worldwide recessionary shock," Bullard said, speaking at a conference in London.

Pointing out that Russia went into default in 1998, he said, "There is nothing intrinsic about such crises that they need to become important shocks to the broader, global macroeconomy."

He further said, "Countries do default … and the world goes on."

The $957 billion rescue package for debt-burdened countries in Europe would "buy substantial time," and that the political will to prevent failure was in place, Bullard said.

He further said, "Too big to fail is a controversial policy, but it does have its upside in the current situation."

Checking himself, Bullard said "maybe" this time would be different, citing the relative weakness of financial firms that were deeply in government bonds.

He also said that while a spreading contagion could "reignite the type of financial shock seen in the fall of 2008 … I do not think this is a likely scenario." (With Inputs from Agencies)