A senior Federal Reserve official said the pace of job loss had slowed even though unemployment remains high and the challenge for policy makers will be to adjust extensive securities purchases.

Forces driving the U.S. economic recovery include stronger-than-expected global growth, especially in Asia, said James Bullard, the St. Louis Federal Reserve Bank president, in a statement describing remarks prepared for delivery in Shanghai on Monday.

Other forces include recovering consumption expenditures, less stress in financial markets and stabilization in the housing sector, said Bullard, who is a voter on the Fed's interest-rate setting panel.

A copy of his remarks was made available in Washington.

The Fed has chopped benchmark interest rates to near zero and flooded the financial system with over $1 trillion in an effort to pull the economy out of the deepest recession in decades.

Policy-makers have pledged to keep rates exceptionally low for an extended period to nurture the fragile recovery that appears to be taking shape.

Many analysts question whether the recovery can be sustained once government supports are removed. News last week that the unemployment rate was stuck at 10 percent in December underscored the likelihood of persistent weakness in job markets.

In his third public speech during a trip to China, Bullard said the Fed's liquidity programs are not an inflationary concern.

Interest rates may remain low for quite some time, he said.

(Reporting by Mark Felsenthal; Editing by Neil Fullick. Additional reporting by Jason Subler in Shanghai.)

Inflation Unemployment