The U.N. nuclear watchdog says Iran's cooperation to resolve questions about its nuclear program is what the agency calls a "significant step forward."

The International Atomic Energy Agency, or IAEA, made the comment in a report obtained by news agencies. It also said Iran's uranium enrichment program is continuing at a slower rate than expected.

Iran's state-run IRNA news agency says a top Iranian nuclear official, Mohammad Saeedi, said the report puts an end to what he called all the "baseless" accusations by the United States.

But the United States says Iran should have answered questions about its nuclear program four years ago.

A State Department spokesman Tom Casey said Iran has failed to comply with an international obligation to stop uranium enrichment and the international community will continue to increase pressure on the country.

In the report, the Vienna-based IAEA said once Iran's past nuclear activities have been clarified, the country will need to continue to build confidence about the scope and nature of its present and future nuclear programs.

Iran is reported to have resolved questions with the IAEA about its tests with plutonium. Highly enriched uranium and plutonium can be used to make nuclear weapons.

The United States is seeking another U.N. Security Council sanction resolution on Iran.

Also, the IAEA says agency director Mohamed ElBaradei has circulated his latest report on Iran to the IAEA board. The IAEA says the document covers developments since ElBaradei's last report in May, and members of the board are to consider it during their meetings beginning September 10 in Vienna.

The United States and its allies accuse Iran of seeking to build atomic weapons under the cover of a civilian program. Iran denies the charge and says its program is for peaceful purposes.