The head of the US Federal Reserve says the United States still faces "difficult choices" in cutting the country's deficit.
In prepared comments to a joint economic committee of Congress, chairman Ben Bernanke said that action could not be delayed.
Mr Bernanke added that weakness in the construction sector was still weighing on the economy.
His cautious comments about the recovery come despite data showing a 1.6% increase in March retail sales.
"Addressing the country's fiscal problems will require difficult choices, but postponing them will only make them more difficult," Mr Bernanke said.
"Significant restraints on the pace of the recovery remain, including weakness in both residential and non-residential construction and the poor fiscal condition of many states and local governments."
But he added that there were some encouraging signs for the economy.
Job cuts were slowing and consumer spending continued to increase in the first two months of the year.
However, he went on to express particular concern about a high level of long-term unemployment.
In March, 44% of the unemployed had been without a job for six months or more.
The BBC reports some 8.5 million jobs have been lost in the US as a result of the recession.
