Israel sought yesterday to lower US expectations for any deal with the Palestinians this year, brushing aside pressure over settlements and calling for decisions on Jerusalem's future to be deferred.

US Secretary of State Condoleezza Rice ended her sixth trip to the region this year with no sign of progress in nudging both sides toward a peace deal by the end of 2008.

She held three-way talks with Israeli Defense Minister Ehud Barak and Palestinian Prime Minister Salam Fayyad before making a surprise visit to Beirut.