JERUSALEM - Israel's foreign minister said Sunday that a peace deal with the Palestinians is "impossible" under current conditions and that Israel should pursue a lesser deal instead - a concept the Palestinians swiftly rejected.

The latest diplomatic spat between the two sides came as violence along the Israel-Gaza border simmered. After days of accelerated Palestinian rocket attacks on southern Israel and Israeli airstrikes in response, Israeli soldiers killed two Palestinians on the border early Sunday.

Avigdor Lieberman, the Israeli foreign minister, told a conference of Israeli diplomats that instead of a full peace deal, Israel should seek a long-term, interim agreement on security and economic matters. Palestinians have consistently rejected that approach.

A statement Sunday from Prime Minister Benjamin Netanyahu's office said the comments reflect Lieberman's "personal positions," not those of the government.

Referring to an overall peace agreement, Lieberman told the conference: "It's not only that it is impossible . . . It is simply forbidden." He said the West Bank Palestinian Authority - with whom Israel has pledged to negotiate - is "not legitimate" because it has postponed elections.

Lieberman is known to express hard-line views that don't always represent Netanyahu, who says he seeks a negotiated, final peace deal with Palestinians but has declined to give details.

Palestinian Authority spokesman Ghassan Khatib rejected Lieberman's comments, saying most world governments including Israel's, recognize the Palestinian Authority as legitimate. He said the Palestinians would not accept an interim agreement. "It's too late now for anything except ending the occupation and allowing for two states on the '67 borders," Khatib said, referring to 1949 truce lines that marked the West Bank until the 1967 Mideast war, when Israel captured the territory.

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