JERUSALEM, Israel - Prime Minister Benjamin Netanyahu said on Sunday that Israel had not yet made any decision on the US demand that it freeze all settlement activity on occupied Palestinian land.

"No decision has been taken on this matter and no conclusion has been drawn," the hawkish premier told Israeli radio stations when asked to comment on recent reports that Israel would agree to a nine-month freeze in the occupied West Bank but not in annexed east Jerusalem.

"These are rumours," he said ahead of the weekly cabinet meeting. "We have not accepted anything and are continuing the dialogue with Washington."

The United States has been pressing Israel to freeze all settlement activity as part of its efforts to jump-start the stalled Middle East peace process.

Israel has so far refused a complete freeze, but said it would not issue any new tenders until early 2010 - a gesture that Washington called a step in the right direction, but that critics slammed as falling short of a full freeze.

Netanyahu's comments come ahead of a meeting this week between Israeli officials and US Middle East envoy George Mitchell.
Netanyahu met Mitchell in London last week, where the two failed to reach a deal on the thorny issue of settlements - one of the main obstacles in the faltering peace process. -AFP