Reuters Summit-WRAPUP 2-Summers: U.S. economic recovery on track

* Summers: No doubt economy grew in Q3, likely in Q4 too

* Backs U.S. dollar, says its global status not at risk

* Acknowledges deficit worries, takes it seriously (New throughout with more details)

WASHINGTON, Oct 21 - The U.S. economy is firmly poised for a recovery from its deep recession but growth may be moderate and the job market will not revive immediately, senior White House aide Lawrence Summers predicted on Wednesday.

"There's really no doubt that the third quarter registered growth, and growth at a nontrivial rate, and every expectation that the fourth quarter will do the same," Summers said at the Reuters Washington Summit.

Summers, who heads the White House's National Economic Council, also gave a strong backing to the beleaguered U.S. dollar, which has fallen to a 14-month low against major currencies.

He said he did not think the dollar's status as a global reserve currency was in jeopardy.

"I think the dollar ... is going to be the world's primary reserve currency for ... the foreseeable future," Summers said at the Reuters Washington Summit.

"I think the most important thing we can do for the dollar is make sure that it rests on strong fundamentals," he added.

On the economy, he said the $787 billion stimulus package and inventory rebuilding by businesses were among the "dominant drivers" lifting the economy.

But Summers said there remained considerable slack in the economy and that job growth would lag behind the recovery in the broader economy.

"It will be some time before unemployment starts to decline. Once it declines it will take a long time to return to normal levels, given how elevated it is," he said of the unemployment rate, which now stands at a 26-year-high of 9.8 percent.

"The question of what will propel growth throughout the expansion is still a crucial one," he said. "But that's always the case at the beginning of expansions."

Most private economists think the recession, which began in December 2007, ended in the third quarter. But there is much disagreement about the path of recovery.

Some see above-average growth continuing through next year, arguing that deep recessions are typically followed by powerful recoveries, helped along by pent-up demand as consumers and companies resume spending.

But others worry that heavily indebted households will remain cautious in their spending, particularly with unemployment near 10 percent and likely to drift higher, which would restrain the recovery.

What more President Barack Obama's administration might do about it remains unclear, particularly with the budget deficit now at $1.4 trillion.

That is equivalent to 10 percent of the economy, the highest share since the end of World War II. Forecasters believe the deficit will remain high in the coming years.

Summers acknowledged those worries, and their possible implications for the value of the dollar, and said he took "very seriously" longer-term concerns about indebtedness.

Earlier on Wednesday, Commerce Secretary Gary Locke told Reuters Television the dollar was a "concern," since dollar weakness could push up the price of oil and other imports.

Summers said the price of oil, which hit a one-year high above $81 a barrel on Wednesday, did not risk throwing the U.S. recovery off the rails.

"I think the increase in oil prices is probably ... more a reflection of recovery and the expectation of continued recovery than a threat to recovery," he said.

As the administration weighs possible further steps to give a boost to the job market and the economy, Summers said the White House was open to extending the tax credit for home buying, a popular idea on Capitol Hill.

He said there was a case to be made for extending the credit "in terms of supporting the housing market." But he added: "At the same time, we can't afford everything for which there is a case."

Summers said he remained hopeful that legislation to broadly rewrite U.S. financial regulations would pass this year. "I don't see any reason why it can't get done this year," he said.

Analysts following the debate on Capitol Hill have become increasingly skeptical that Obama can meet his goal of enacting it by year-end. Some say that early next year might be a more realistic time frame.

While some critics say the bill is not robust enough, Summers said he believed that the changes would have a chance to have a major impact on financial stability for years to come. (For summit blog: http://blogs.reuters.com/summits/)