Federal Reserve Chairman Ben Bernanke (file photo)The head of the U.S. central banking system says the prospects are goodfor a return to global economic growth in the near future.

BenBernanke told the world's top central bankers Friday that economicactivity appears to be leveling out after contracting sharply over thepast year.

But the U.S. Federal Reserve chairman warned that difficult challenges remain.

Thebankers are at an annual meeting in the mountain town of JacksonHole, in the western U.S. state of Wyoming, where they are reflectingon the global economic recession.

Germany, France and Japan have pulled out of recession, and the U.S. economy is showing signs of stabilization.

OnFriday, the National Association of Realtors said U.S. home sales rose7.2 percent in July.  That is its largest monthly increase in 10 years.

A slowdown in the housing market andproblems with home owners repaying their loans helped spark the U.S.economic crisis and the global slowdown that followed.

TheFederal Reserve injected trillions of dollars into the U.S. economy totry to stop it from shrinking and to jump-start growth.

In Europe Friday, a closely watched survey showed the 16 countries using the euro currency are close to growing again.

Thefinancial information company Markit said its measure of businessactivity - the composite purchasing managers' index - for the eurozonerose in August.

The index climbed three points to 50, a number that marks the point between economic expansion and contraction.


Some information for this report was provided by AFP, AP and Reuters.