Fed's Yellen says strength of recovery in question

The U.S. economic recovery still faces many hurdles, including a persistently weak labor market and strained household budgets, Janet Yellen, President of the Federal Reserve Bank of San Francisco, said on Tuesday.

Yellen said she was not the least bit worried about inflation, arguing instead that the possibility of a problematic drop in consumer prices remains the greater risk.

The strength and durability of the expansion is in question, Yellen said. Some of the rebound is due to temporary government programs and a swing in inventory investment that will not provide an ongoing source of growth.

(Reporting by Pedro Nicolaci da Costa, Editing by Chizu Nomiyama)