In his weekly radio address, Bush acknowledged that Ramazan has been "rough" for both US troops and Iraqis.
But he attributed the growing violence to more active operations by US troops as well as "a sophisticated propaganda strategy' pursued by insurgents.
"There is one thing we will not do: We will not pull our troops off the battlefield before the mission is complete," Bush said.
He assured the United States was "constantly adjusting" its tactics in the face of arising difficulties.
The spike in violence has increased pressure on the Bush administration to change course in Iraq, and many Republicans are concerned the apparent lack of progress there could result in losses in the November 7 congressional elections.
On Saturday, the president was scheduled to meet with top generals to discuss strategy for Iraq, but the White House denied the meeting was called in response to recent developments.
"We will continue to be flexible, and make every necessary change to prevail in this struggle," Bush assured.
He insisted terrorists knew "they cannot defeat us in the battle, so they conduct high-profile attacks, hoping that the images of violence will demoralise our country and force us to retreat."
"The terrorists are trying to divide America and break our will, and we must not allow them to succeed," he said.

Copyright AFP (Agence France-Presse), 2006