WRAPUP 1-Bernanke sees long slog to lower U.S. unemployment
* Bernanke says won't see 6 percent jobless rate until 2016
* Fed chief tries to calm concerns over risks of Fed policies
* "Significant majority" support policy course
WASHINGTON, Feb 27 (Reuters) - The U.S. jobless rate is unlikely to reach more normal levels for several years, Federal Reserve Chairman Ben Bernanke said on Wednesday as he again defended the central bank's forceful easing of monetary policy.
Appearing before a congressional panel for a second straight day, Bernanke downplayed signs of internal divisions at the Fed, saying the policy of quantitative easing, or QE, has the support of a "significant majority" of top central bank officials.
One lawmaker asked Bernanke when the economy might produce enough jobs to bring the unemployment rate, currently at 7.9 percent, down to 6 percent - the top of the Fed's long-term forecast range.
"A reasonable guess for 6 percent would be around 2016, about three more years," Bernanke told the House of Representatives Financial Services Committee.
Moreover, as he had in an appearance before the Senate Banking Committee on Tuesday, the Fed chairman countered the notion that the Fed's loose monetary stance might be fueling asset bubbles or inflation.
"It's our view that there's still a good bit of slack in the economy. I don't think the economy is overheating," he said.
Financial markets were again encouraged by Bernanke's remarks, with stocks rallying for a second day on the Fed chief's signal of continued stimulus combined with enthusiasm over strong figures on business investment plans.
"He is going to be refilling the punchbowl for a very long time," said Keith Bliss, senior vice-president at Cuttone & Co. in New York.
In response to the financial crisis and deep recession of 2007-2009, the Fed slashed official borrowing costs to effectively zero, and bought more than $2.5 trillion in mortgage and Treasury securities to keep long-term rates low.
It is currently buying $85 billion in bonds per month, a policy Fed officials backed in an 11-1 vote in January. However, minutes of that meeting released last week showed many officials had concerns over the risks presented by the central bank's policy course.
Bernanke argued the Fed's extraordinary easing of monetary policy deserves at least some credit for the ongoing economic recovery, even if growth remains fragile and vulnerable to looming short-run spending cuts from the U.S. government.
Indeed, he argued that current plans for abrupt short-term deficit reduction could be counterproductive, even for the purposes of reducing government debt levels.
"I'm still concerned about the short-run impact on jobs," he said. "(You) don't get as much benefit as you think because if you slow the economy that hurts your revenues and that means your deficit reduction is not as big as you think it is."
A number Republicans on the House committee said they also were concerned about the Fed's actions.
"For diminishing marginal benefits, the Federal Reserve's unconventional strategy creates considerable risks," said Representative Jeb Hensarling, the panel's chairman. "If the (Fed's) balance sheet is not unwound at the right time and at the right pace, we could be looking at another deep recession, soaring inflation or skyrocketing interest rates."
Bernanke tried to soothe such worries, expressed by a number of lawmakers, that the central bank was so far into uncharted policy territory that an exit could be problematic.
Admitting the Fed would face an unprecedented task, Bernanke nonetheless said the central bank has the right tools to exit when the time comes, adding that those measures have been tested and used in other countries.
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