US President George W. Bush said on Wednesday he saw signs of progress in Iraq on both the military and political fronts and again held out the possibility of a reduction in US troop levels. But Bush said no final decisions had been made on troop levels and said he would not follow "artificial timetables" to gauge whether it was time to make reductions.

"I'm not interested in artificial timetables, or dates of withdrawal. I'm interested in achieving an objective," Bush said at a joint news conference in Sydney with Australian Prime Minister John Howard ahead of the Asia-Pacific leaders' summit.

Bush arrived in Sydney on Tuesday night, after a surprise trip to Iraq that comes a week before the top US general in Iraq, David Petraeus, and US ambassador to Iraq, Ryan Crocker, are to testify to the US Congress on conditions there.

He said the Petraeus-Crocker recommendations would be key to helping him formulate his strategy, but stopped short of saying whether a report he would submit to Congress after their testimony would contain further specifics on troop levels.

Bush saw achievements in bringing down the levels of violence and on reconciling Iraq's warring factions, a view much more upbeat than that of a US Congressional report on Tuesday that found still-high levels of violence and little progress on the political front.

"Reconciliation is taking place and it's important, in my judgment, for the security of America and for the security of Australia that we hang in there with the Iraqis and help them," Bush said.

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