One month of improved data does not constitute an economic recovery and recession in the United States will last for at least a few more months, Atlanta Federal Reserve President Dennis Lockhart said on Thursday.

New orders for long-lasting U.S.-made goods rose in February for the first time in seven months and new home sales rebounded, government data showed on Wednesday.

I would always caution that one month does not make a recovery so we have to be careful not to react too strongly to one month, Lockhart told Reuters on the sidelines of a food conference in Paris.

He said he had seen very few signs of a U.S. recovery.

Most of the data that we follow appears to signal a continuing recession, at least a few more months, he said.

Asked whether the outlook had improved since the Fed's last policy meeting, he said: I think it's premature to say that.

Lockhart also said it was perfectly appropriate to have a discussion about reserve currencies but added: I agree with Secretary Geithner that the U.S. dollar in all likelihood will remain a dominant reserve currency but there is nothing wrong with discussing alternatives.

U.S. Treasury Secretary Timothy Geithner said on Wednesday he was open to expanding the use of the International Monetary Fund's special drawing rights.

Investors initially interpreted his remarks as an endorsement of China's proposal on Monday to eventually replace the dollar as the world's reserve currency by the IMF's SDRs.

Geithner's comments sent the dollar tumbling although it later rebounded after he said the greenback would keep its status as the top reserve currency for a long time.

Lockhart said the U.S. central bank's $300 billion debt purchase program should help bring down long-term interest rates.

Asked whether the next step would be to issue Fed bills, he said: That has not been decided yet.

NO EXPORT RECOVERY

In his speech to the conference, Lockhart said U.S. exports, which supported economic growth until collapsing at the end of 2008, were unlikely to fuel a rebound this year.

In my economic outlook for the remainder of 2009, I do not expect a sudden return of exports as a driver of recovery in the United States, he said in remarks prepared for delivery.

The recent sharp contraction of trade appears to be far more severe than would be expected given the decline in global economic activity, he said.

Liabilities on the Fed's balance sheet rose to $2.050 trillion as of March 18 from $1.882 trillion the previous week and is expected to continue to rise

The Fed said this month it would buy $300 billion of long-dated Treasuries over the next six months., its first large-scale purchases of government debt since the early 1960s, while also boosting buying of mortgage-backed securities and agency debt in its bid to rescue the economy.

At present, the inflation expectations in the United States appear to be stable, not surprisingly because inflation risks have declined, Lockhart said.

I would say however that there is reasonable concern related to the growth of the balance sheet of the central bank in response to the economic difficulties that we are having, that this could in the long term fuel inflation.

(Reporting by Anna Willard and Tamora Vidaillet, editing by Mike Peacock)

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