In central Baghdad's prosperous Karrada neighbourhood, shopkeepers swept up broken glass after a car bomb killed 15 people and wounded 35 on Wednesday, across the Tigris River from the "Green Zone" compound where Gates met Iraqi officials.
With signs of normal life returning, defiant Baghdadis have ignored the destruction to return to Karrada's boutiques.
"That? That was just one explosion," said Um Fadhil as she tried on boots with her two teenaged daughters at a shop just 100 metres from the blast site. "No, I am not afraid."
Perfume shop owner Abu Hiba said life and business would go on. "Attacks like these are the final throes of a dying bull."
The Karrada blast was among four across in central and northern Iraq on Wednesday which killed a total of 23 people.
Violence across Iraq has fallen to its lowest level since the bombing of a Shi'ite shrine in Samarra in February 2006 unleashed reprisal attacks which threatened sectarian civil war.
With attacks down 55 percent since a "surge" of 30,000 extra U.S. troops became fully deployed in mid-June, Gates sounded an optimistic note after his meetings with Iraqi officials.
"I came away with a sense that there is growing pressure from below for the top levels of the government to replicate the kind of reconciliation that's going on in a variety of other places in Iraq," Gates told reporters in Bahrain.
Along with the extra troops, credit for the decline in violence has also been given to the growth of U.S.-backed neighbourhood security patrols organised by mainly Sunni Arab tribal sheikhs who have turned against al Qaeda.
But Washington has also been frustrated by the Shi'ite-led government's slow progress on political reforms meant to reconcile Iraq's minority Sunni Arabs and majority Shi'ites.
"What was interesting in meeting both with the prime minister and the presidential council is they know what they need to do and they know that people are getting impatient and that they need to get on with legislation," Gates said.
