January 1, 1998

Israeli FM Levy threatens to resign in a dispute over budget allocations, threatening the stability of Netanyahu's government. During the past wk. of budget negotiations, Netanyahu has promised right-wing coalition mbrs. tens of millions of dollars for settlements, new bypass roads. (NYT 1/1; CSM, WP, WT 1/2)

Unidentified assailants shoot, wound Israeli woman traveling in the West Bank. Israel imposes curfew on nearby Palestinian villages of Adik, Bruqin. (WP 1/2; JP 1/10)

Nr. Khan Yunis in Gaza, IDF soldiers open fire on a PA police patrol that comes "too close" to their position. In retaliation PA police open fire at 3 Israeli checkpoints in the area. No casualties are reported. (PR 1/9)