JERUSALEM - ISRAEL'S government says it has approved the construction of 238 homes in Jewish neighbourhoods in east Jerusalem, ending an unofficial freeze on new building there for nearly a year.

The announcement was released by Israel's Housing Ministry. The office of Prime Minister Benjamin Netanyahu would not comment on Friday.

Israeli officials said they discussed the construction in the neighbourhoods of Ramot and Pisgat Zeev with the US administration and cut the number of planned units to temper American displeasure.

An Israeli settlement slowdown imposed last November in the West Bank did not officially include east Jerusalem, which Israel considers part of its capital. But before Friday, Israel had quietly halted building there as well.

The issue of Israeli settlement building is threatening to derail recently renewed Mideast peace talks.

Approval of east Jerusalem homes