"The secretary has not a moment of regret about every ounce of time he's spent on this effort," his spokeswoman Jen Psaki said.

But she acknowledged that yesterday, which Kerry had set as a deadline for reaching a full peace treaty between the Israelis and Palestinians, had expired without a deal.

"The original negotiating period was set to run until April 29th, on Tuesday. There's nothing special about that date now," Psaki said.

But Kerry, who single-handedly dragged Israel and the Palestinians back to the negotiations after a three-year hiatus, has "no regrets about the time he spent investing in this process."

"We've reached a point... where a pause is necessary... a holding period, where parties will figure out what they want to do next."

She refused to attribute blame for the collapse in the talks to either side in the dispute, saying both had taken "unhelpful" steps.

Nor would she "look into a rear-view mirror" to analyze what had gone wrong with the American effort, saying only that there were "difficult choices to make. There's a lot of history here."

Last week, just days before the deadline, Israel cancelled its participation in the talks after Palestinian president Mahmud Abbas announced he had reached a reconciliation deal with the militant Hamas to set up a unity government.

Abbas has insisted that the new government, which will be made up of technocrats and political independents, would recognize Israel, reject violence and abide by existing agreements.

It will be formed within five weeks with the aim of organising presidential and parliamentary elections.

In an apparent shift in the US policy, Psaki appeared to suggest that Washington may be prepared to accept a reconciliation government providing it stood by principles such as non-violence and recognizing the state of Israel.

"If the unity government accepts certain principles, then it hasn't been our position to oppose that," Psaki said.


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