Washington - The United States late Saturday expressed disappointment in the direction of the new Palestinian government, saying its policies were 'inconsistent' with the principles of an international peace plan.

The US believes that any new Palestinian government 'must renounce violence, recognize Israel and respect previous agreements and obligations between parties,' a US State Department official said.

The Palestinian Legislative Council (PLC) earlier Saturday confirmed the new national unity government between the rival Palestinian groups Fatah and Hamas.

In a speech, Prime Minister Ismail Haniya pledged to honour international peace agreements. But he also proclaimed that the Palestinians have the 'legitimate right' of resistance and to 'defend themselves against any Israeli aggression.'

Nancy Beck, a press officer of the US State Department, said that the reference to right of resistance was 'disturbing and contradicts directly' the renunciation of violence that is a cornerstone of the roadmap laid out by the international mediation group called the quartet.

She called Haniya's speech 'disappointing and inconsistent' with the quartet's principles and a 'missed opportunity' to confirm the new government's commitment to peace.

'A Palestinian state will not be born from terror,' she said.

The US would however continue to evaluate the new government's 'word and action,' which she said should begin with the immediate freeing of the Israeli soldier, Corporal Gilad Shalit, held captive in Gaza since last summer.

Haniya said his government would support efforts to gain Shalit's release.

Israel has already rejected cooperation with the government because the radical Islamic Hamas movement does not explicitly accept Israel's right to exist.

The unity government between the rival Palestinian factions was formed after a crippling, one-year-old boycott by the international community of Haniya's previous Hamas-led government, which had refused to renounce violence or recognize Israel.

Earlier Saturday, the European Union said it would keep its financial boycott in tact, but greeted the swearing in of the new unity government.

The EU president said EU support would continue to consist of direct payments for social projects until the new government adopts a platform that respects the principles of the Mideast quartet, which consists of Russia, the US, the United Nations and European Union.