Washington - President Barack Obama on Tuesday said the government's efforts to pull the US economy out of a devastating recession were beginning to show signs of progress. "By no means are we out of the woods just yet. But from where we stand, for the very first time, we are beginning to see glimmers of hope," Obama said in prepared remarks released by the White House ahead of a speech on the economy, picking up on the more upbeat tone he first sounded last week.

In a speech to be given at Georgetown University in Washington, Obama cited indicators that banks were freeing up lending and homeowners were taking advantage of low mortgage rates to shore up their finances.

He touted the administration's 787-billion-dollar economic stimulus package as well as a series of massive lending programmes to help revive the banking sector, which is going through the worst financial crisis since the Great Depression.

"Taken together, these actions are starting to generate signs of economic progress," Obama said, but warned that 2009 would "continue to be a difficult year."

The US economy shrank 6.3 per cent in the last quarter of 2008 and economists are bracing for a similar figure at the start of this year.

But Federal Reserve Chairman Ben Bernanke offered a similarly optimistic assessment to Obama's earlier Tuesday in a speech in Atlanta, Georgia, noting there were "tentative signs that the sharp decline in economic activity may be slowing."

US officials are hoping the economy may pull out of recession by the end of 2009.(dpa)