Fed's Bullard- policy to stay very loose for while

PHILADELPHIA, June 30 (Reuters) - Very accommodative Federal Reserve monetary policy will stay for an extended period and a premature exit from this strategy could thwart U.S. economic recovery, a top Fed official said on Tuesday.

But St. Louis Federal Reserve Bank President James Bullard said having a plan to withdraw the Fed's massive expansion of the U.S. monetary base was important to control inflation expectations. And he said that selling Fed-owned assets was probably the most likely way it would choose to go.

"Without an exit strategy, expectations of high inflation may develop," Bullard told a Global Interdependence Center event held at the Federal Reserve Bank of Philadelphia.

"If expectations of inflation feed into today's long-term yields, those yields will rise today and hamper recovery prospects," he said in prepared remarks.

Bullard will be a voting member of the Fed's policy-setting committee next year. (Reporting by Alister Bull; Editing by James Dalgleish)