Israeli officials believed that the "limited" response to the deadly suicide bombing in Tel Aviv on Monday would help preserve the strong international front against Hamas.

In spite of holding the Palestinian National Authority (PNA) responsible for the deadliest terror attack in 20 months, Israeli cabinet decided on Tuesday to refrain from launching an escalated military operation against the Hamas-led Palestinian government.

Interim Prime Minister Ehud Olmert blocked a proposal to declare the PNA an "enemy entity", which would pave the way for direct strikes against the Palestinian government. Until now, economic and political boycotts have been the main tools against the Hamas-led government.

But officials said Israel would take all possible steps it deems necessary, including assassinating terrorists, to prevent further attacks.

Some Israeli officials said the government is pleased with the strong international front against Hamas and does not want to jeopardize that through overwhelming military action.

After Monday's bombing which left nine Israelis dead, international community has largely voiced condemnation against the terror attack.

The United States and the European Union had cut off aid to the Palestinian government because Hamas rejected their demands to renounce violence and recognize Israel's right to exist.

Japanese Foreign Ministry said on Tuesday that the Asian country will not make any new aid commitments to the PNA until the Hamas government demonstrates its support for peace with Israel.

One senior Israeli official said on condition of anonymity that it is not realistic to expect Israel to immediately carry out large-scale air strikes as a knee-jerk response to Palestinian violence, local Jerusalem Post reported.

"This doesn't mean you won't see more targeted killings and other operational things," he was quoted as saying, "it has to be done in an effective way that the whole international community will understand."

Although Islamic Jihad, or Holy War, claimed responsibility for Monday's attack and Hamas was not directly involved, its leaders defended the attack as a self defense against Israeli occupation and aggression.

Aides to Olmert said that he was well aware of the need to maintain international support, especially as he prepares to carry out a unilateral withdrawal from much of the West Bank.

Olmert reiterated that he would carry out the pullout if he concludes there is no negotiating partner on the Palestinian side.

(Xinhua News Agency April 20, 2006)