WASHINGTON (Reuters) - Top forecasters are growing more confident the U.S. economy has embarked on a sustainable recovery, a survey released on Tuesday showed.

The Blue Chip Economic Indicators newsletter for November found forecasters had raised their 2010 projections for gross domestic product for a fourth straight month. However, they still expect the pace of growth to fall short of the typical post-recession bounce.

The U.S. economy should expand 2.7 percent next year, the newsletter said. That marked an upward revision from the 2.5 percent pace the survey panel had expected a month ago.

For 2009, the consensus of the 52 economists polled was for a contraction of 2.4 percent, 0.1 percentage point less than the prior estimate.

"The major uncertainty surrounding the outlook for growth next year involves the degree to which private demand accelerates as the positive contributions to GDP from reduced business inventory liquidation and fiscal stimulus play out," the newsletter said.

The government said last month that the economy grew at a 3.5 percent annual rate in the third quarter after contracting in five out of the prior six quarters.

However, a report on Friday showed the jobless rate jumped to a 26-1/2 year high of 10.2 percent in October, suggesting employers are doubtful about a sustained expansion soon.

The jobs market is expected to improve slowly. Fifty-two percent of the economists surveyed said the unemployment rate will not fall below 7 percent on a sustained basis until the first half of 2013 or later. Continued...