The security situation in Iraq opens the way for improvements in other sectors, such as those concerning the economy and displaced refugees.

The six-month extension of a unilateral cease-fire by Sadr's Mahdi Army will contribute to the security in Iraq, allowing for the millions of Iraqi refugees living abroad to begin to return home, the U.N.'s humanitarian news agency, IRIN, said Thursday.

Abdul-Hadi Nasser Joda with the University of Basra sees Sadr's move as a strategic one, positioning himself as a political figure contributing to the reduction in violence in Iraq.

Joda said Sadr also can appeal to the U.S. and Iraqi governments for political gain.

"With the remarkable security achievements in Baghdad and southern Iraq, (Sadr) wants to make himself a player that the USA and the Iraqi government must continue to deal with. ... He can always go back to fighting if he wants to play that card," Joda said.

Haqi Youssif Khalil at the University of Baghdad said the cease-fire will contribute to the security gains in Iraq, but also serve as a warning to other factions operating against Sadr's forces as his political influence gains momentum.

Iraqi Prime Minister Nouri al-Maliki praised the cease-fire, calling Sadr's political party an "essential cornerstone … in the new Iraq."

U.S. military officials said most of Baghdad's 479 districts are secure and civilian casualties are down 90 percent from June 2007 levels.