Iranian Supreme Leader Ayatollah Ali Khamenei Wednesday rejected the US accusations that Iran was supporting the insurgents to kill its troops in Iraq, terming the charge as "pure lies", the state media reported.

Khamenei made the remarks when he delivered a speech to a large crowd of Iran's Basij militia in Tehran.

"The US troops were killed by the stupid policy of their country," the leader was quoted as saying.

"Now the American government faced criticism from its own people over the policies, they don't have any answers so they wrongly accuse Iran," he added.

The US has repeatedly accused Tehran of supporting Iraqi insurgents to fight with coalition forces and Iraqi government, but Iran have denied all the accusations, saying Washington was trying to find excuses for its failed policy in the Mideast.

Last Thursday, the United States decided to impose new sanctions against Iran, charging that Tehran supports terrorism in the Middle East, exports missiles and is engaging in a nuclear buildup.

The sanctions will be imposed against Iran's Defense Ministry, its Revolutionary Guard Corps and more than 20 Iranian companies, banks and individuals.

Under US laws, any assets found in the United States belonging to the designated groups must be frozen. Americans are also forbidden from doing business with them.

The sanctions are believed to be the toughest Washington has levied against Iran since the 1979 takeover of the US Embassy in Tehran.

Iran's President Mahmoud Ahmadinejad has called the sanctions " hollow", and Foreign Ministry spokesman Mohammad Ali Hosseini also has condemned the sanctions, calling the measures were doomed to fail.

(Xinhua News Agency November 1, 2007)