The US decision to end an economic and political embargo on the Palestinian Authority increased pressure for a reciprocal move from Israel as the Bush administration hoped to improve the chances for peace.

Former Premier Ehud Barak, trying to regain control of his Labour Party, today called for Israeli Prime Minister Ehud Olmert to resign because of the harsh findings of an inquiry into last year’s Lebanon war.

Israel has freed a promised £50m (€76m) in frozen tax funds and transferred the money to Palestinian President Mahmoud Abbas, an official in Israeli Prime Minister Ehud Olmert’s office said today.

ISRAEL will invite Palestinian President Mahmoud Abbas to resume stalled peace talks after Palestinian militants release a captured Israeli soldier, Vice Premier Shimon Peres said yesterday.