President Barack Obama and Federal Reserve chairman Ben Bernanke yesterday voiced wary optimism that the US economy is no longer in freefall, even as new data showed retail sales fell in March.

In a speech at Georgetown University, Mr Obama reiterated that he detected “glimmers of hope” in the economy. He said the $787bn stimulus, the $700bn bank recapitalisation programme, $70bn housing plan and extra federal aid to Detroit auto-companies were “starting to generate signs of economic progress”.

Meanwhile, Mr Bernanke said: “We have seen tentative signs that the sharp decline in economic activity may be slowing.” He added that “a levelling out of economic activity is the first step toward recovery” – though he did not say when he thought this levelling out would take place.