The US economic outlook is "positive," US Deputy Treasury Secretary Robert Kimmitt said.

Economic activity had a "significant pickup" in the fourth quarter, the housing market's slump appears benign and about to end, Kimmitt said, adding that he expects a "solid" 2007 marked by job creation and "moderate inflation."

Speaking at the World Economic Forum's Annual Meeting, Kimmitt acknowledged that the US had responsibilities in the global goal of reducing imbalances, in which the twin budget and trade deficits in the US mirror growing surpluses in China and oil exporting nations.

The US federal budget deficit is declining, he noted.

That is welcome to other key participants in the global economy. Kimmitt suggested other countries could also do more to stoke demand to relieve the reliance on US consumption.

"We'd certainly like to see some demand-led growth in Europe and Asia," he said. "And we'd like to see currencies flexibility in emerging markets ... especially in China." (Dow Jones & Company, Inc.)