The U.S. economy faces a weak recovery that will likely warrant extremely low interest rates for the foreseeable future, a top Federal Reserve official said on Tuesday.

Given the tepid rebound, inflation should not become a problem despite unprecedented emergency lending by the central bank, Federal Reserve Bank of Dallas President Richard Fisher said.

Inflation is likely to remain subdued for some time, and thus our current policy is appropriate, Fisher said in prepared remarks for delivery to the Austin Headliners Club, a group of business executives, lobbyists and politicians.

The Fed cut interest rates to near zero last December and has pumped more than $1 trillion into the economy to tame a severe financial crisis and the deepest recession since the 1930s.

These measures are not without their risks. Fisher said he was mindful of the possibility that the central bank's pledge to keep rates at rock bottom for an extended period could fuel unwanted speculative activity in financial markets.

Were this to become a disorderly influence, I would expect the FOMC and other authorities to craft an appropriate remedy, he said.

The economy grew 3.5 percent in the third quarter, but the jobs picture remains dismal, with the unemployment rate surging to 10.2 percent in October.

Fisher, who is not currently a voter on the Fed's policy setting committee, saw expansion continuing in the fourth quarter, but expected subpar growth in 2010 and perhaps 2011.

He said it would take considerable time for bank lending to recover due to commercial real estate woes and uncertainties over new government initiatives and regulation.

The most likely outcome is for growth to be suboptimal, unemployment to remain a vexing problem and inflation to remain subdued, Fisher said.

On the positive side, the U.S. housing sector appears to be stabilizing, American household net worth likely rose in the third quarter and interest rate spreads have returned to near normalcy.

(Reporting by Pedro Nicolaci da Costa, Editing by Andrew Hay)