ISRAELI troops demolished three houses of Palestinian terror suspects yesterday, while Jewish settler leaders inaugurated a new Jewish settlement near the Palestinian city of Nablus.

Mr Powell is due to meet Israeli Prime Minister Ariel Sharon today before travelling to Ramallah for a meeting with the besieged Palestinian leader Yasser Arafat.

Israel has killed six Palestinian policemen in a series of raids on four West Bank towns and villages today.

Israeli forces hit back with a missile attack on a Palestinian security building yesterday after four bombs exploded on the streets of Jerusalem.