WASHINGTON (Reuters) - The U.S. economy is doing well and faces no serious obstacles in the short term, with the labor market looking pretty strong, Federal Reserve Chair Janet Yellen said on Thursday.

In the "short term I would say I don't think there are serious obstacles. I see the economy as doing quite well," Yellen said in a town hall meeting with educators, adding that she was worried about longer-term issues like widening income inequality and weak growth in labor productivity.

(Reporting by Jason Lange; Editing by Sandra Maler)