Israeli settlers said today that they will slowly resume building new Jewish homes in West Bank settlements - just hours after a construction ban which helped jump-start Middle East peace talks expired.

Mayor Oded Revivi, in the Efrat settlement, said banks and developers were reluctant to get into commitments, fearing construction would be stopped again.

Palestinians have threatened to walk out of the recently resumed negotiations if the building continues, though Palestinian President Mahmoud Abbas has signalled that he will not immediately quit the peace talks.

US-led efforts to work out a compromise over the weekend failed.

Israeli Prime Minister Benjamin Netanyahu has urged Mr Abbas to keep negotiating.

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