LONDON, England - March 1, 2011 - The rise in gasoline prices in the U.S. is "a problem for a lot of people," but doesn't yet pose a threat to either economic recovery or inflation, Federal Reserve chairman Ben Bernanke has said.

Bernanke made the comment in the first of two days of testimony in front of Congress, as economists try to gauge whether higher prices at the pump will further derail the economy.

With political unrest having spread to Libya, the price of a gallon of gasoline climbed to $3.29 last week, its highest since 2008, according to the Automobile Club of America (AAA).

The Fed chairman also played down the prospect that rising commodity prices will feed inflation. As the idea of economic recovery gains traction, the focus for many in Congress is beginning to turn to the prospect of rising inflation.

Bernanke did admit that the risk of deflation - or a sustained drop in prices - was now negligible. Fighting deflation was one of Fed's justifications for embarking on a second, much more controversial round of quantitative easing last November.

The second was to bring down unemployment, which has not fallen below the 9% mark since spring of 2009. Though he did not provide any substantial reasons why it should be so, the Fed chairman struck a more optimistic note on the jobs market, telling Senators that "we do see some grounds for optimism about the job market over the next few quarters."