US Treasury Secretary Janet Yellen criticised Israel for saying it would hold back revenues collected on behalf of the Palestinian Authority and warned it against cutting Palestinian lenders off from their Israeli correspondent banks.

Israel said it would revive stalled ceasefire talks with Hamas after a social media video showing female Israeli soldiers being abducted by the militants on 7 October sparked a public outcry.

Israel to expand Rafah campaign after 1 million civilians moved

Israel will expand its military operation against Hamas in Rafah, saying 1 million civilians had moved out of the southern Gaza city.

“We are strengthening our effort in Rafah — this operation will grow, with more forces on the ground and more forces from the air,” Defense Minister Yoav Gallant said on Thursday.

Israel was operating with care and precision, added military spokesperson Daniel Hagari, following earlier concerns from the US and other allies about the threat to the local population.

Israel has said it needs to invade Rafah to achieve its goal of destroying Hamas. The city, near the Egyptian border, had become a refuge for Palestinian civilians fleeing the war elsewhere in Gaza and the campaign has been an issue during peace talks.

“We will reach our goals — to hit Hamas very hard, to deny its military capabilities, to the point that we create all the conditions to facilitate the return of the hostages to their homes,” Gallant said, speaking from a navy boat off the coast of Gaza on Thursday.

Yellen criticises Israel’s move on Palestinian revenue

US Treasury Secretary Janet Yellen criticised Israel for saying it would hold back revenues collected on behalf of the Palestinian Authority (PA) and warned it against cutting Palestinian lenders off from their Israeli correspondent banks.

The moves “threaten economic stability in the West Bank”, Yellen told reporters ahead of a meeting of Group of Seven finance ministers and central bank governors.

The correspondent banks were “critical for processing transactions that enable almost $8-billion a year in imports from Israel, including electricity, water, fuel, and food, as well as facilitating almost $2-billion a year in exports on which Palestinian livelihoods depend”, she said.

Yellen’s statement came after remarks by Israeli Finance Minister Bezalel Smotrich in which he called on Prime Minister Benjamin Netanyahu to impose “harsh punitive measures” against the PA, which governs Palestinians in the West Bank.

Smotrich and other members of Netanyahu’s coalition are pushing for more punitive measures against the PA as Israel’s war against Hamas in Gaza continues. They say the PA is hostile to Israel and cite its refusal to condemn Hamas’s 7 October attack on southern Israeli communities.

The economies in the Palestinian territories of the West Bank and Gaza are shekel-based and need Israeli banks to make business transactions. Two Israeli lenders, Bank Hapoalim and Israel Discount Bank, act as correspondent banks for this purpose and as part of the Oslo Accords, Israel is obligated to enable this financial channel.

The Israeli lenders have been asked to be relieved of this arrangement for over a decade because they’re legally exposed if the Palestinian banks don’t abide by international restrictions meant to prevent funding for terrorist organisations and money laundering.

Yellen said she expected other countries to also express concern about the impact of such a decision on the West Bank economy — “I think this would have a very adverse effect also on Israel,” she said.

The compensation agreement expired in March and was extended until June. If the pact is not renewed — and Smotrich says he isn’t in favour of a renewal — the Israeli banks will pull out of the whole arrangement.

Israel to restart Gaza talks after hostage video sparks outrage

Israel said it would revive stalled ceasefire talks with Hamas after a social media video showing female Israeli soldiers being abducted by the militants on 7 October sparked a public outcry.

The 190-second clip, compiled from footage filmed by the militants on the day of the attack, shows five young women in civilian clothes, some bruised and bloodied, lined up against a wall before being pushed into a jeep.

The women, who Israel confirmed are military personnel, were kidnapped when Hamas invaded Israel and killed 1,200 people. The attack triggered an Israeli military response that’s destroyed much of Gaza and killed more than 35,000 Palestinians.

More than 100 Israeli hostages are still being held in Gaza by Hamas, although it’s unclear how many are still alive. Hamas is designated a terrorist organisation by the US and the European Union.

In a statement, Hamas said the video showed “deliberate distortions” and dismissed the women’s injuries as “something to be expected”. The statement didn’t address the talks.

Last week, Qatar said the negotiations had reached an impasse after Israel invaded the southern Gazan city of Rafah, where more than 1.4 million Palestinians had sought refuge before being forced to flee again.

The two sides are also at odds over the deployment of Israeli troops in Gaza and the terms of the release of the remaining hostages. Qatar is mediating the talks alongside Egypt and the US.

Harvard students walk out of commencement in protest at suspensions

Hundreds of students walked out of Harvard University’s commencement ceremony on Thursday in protest at the governing board’s decision to withhold degrees for 13 students who participated in a Pro-Palestinian encampment on campus.

A mix of graduate and undergraduate students stood up and chanted as they left in the middle of the ceremony in Harvard Yard, which previously housed the encampment. They continued to protest within earshot while the ceremony continued. Loud booing followed earlier comments by interim President Alan Garber, while the crowd cheered an address from senior Shruthi Kumar, who voiced support for the students who weren’t able to collect their degrees.

“This semester, our freedom of speech and our expressions of solidarity became punishable, leaving our graduations uncertain,” Kumar said. “Harvard, do you hear us?”

The Harvard governing board’s decision to decline degrees came after 115 faculty members showed up to a meeting on Monday and voted to allow the students to graduate, even after they’d been disciplined by an administrative board, according to the Harvard Crimson. The Faculty of Arts and Sciences has about 888 voting members.

The ruling has fuelled divisions between the Harvard Corporation, led by former commerce secretary Penny Pritzker, and some faculty and students. The students were found to have “violated the university’s policies by their conduct during their participation in the recent encampment in Harvard Yard”, the corporation said in a statement on Wednesday. It added that the faculty vote did not revisit the disciplinary proceeding nor restore the students to “good standing”.

Harvard Corporation has been criticised since the 7 October attack on Israel by Hamas, with the university struggling to combat accusations of anti-Semitism on campus and over its handling of former president Claudine Gay, the university’s first black president, who resigned after just months in the role.

In recent weeks it’s come under scrutiny as protesters set up an encampment on Harvard Yard against the war in Gaza, while university leadership, including interim President Garber, has also faced backlash from faculty and students for disciplining activists who are demanding the university disclose its financial ties to Israel and divest.

‘Zionists not welcome’ and attack on encampment ignite backlash at UCLA

Gene Block is about to be hit every which way.

The chancellor for the University of California at Los Angeles will appear at a congressional hearing Thursday to defend the university’s handling of anti-Semitism in recent months, including why Jewish students were blocked from parts of the school by pro-Palestinian protesters, who allegedly displayed signs such as as “Zionists not welcome” at unauthorised encampments.

He’s also likely to be assailed — in the hearing and back on campus — over why UCLA at the end of April failed to stop a mob of pro-Israel demonstrators from attacking the student encampment for hours using metal rods, fireworks and pepper spray. Block called the violence “truly despicable”.

For the chancellor, who has a little more than two months left in office after 17 years running UCLA, the hearing led by Republican Virginia Foxx is expected to be searing but temporary. For the university, reeling from already considerable rifts among administrators, faculty and students, it could have more lasting consequences.

The House Education and the Workforce Committee event serves as a bookend to a tumultuous year on US campuses, in which student protesters from New York to California disrupted classes in autumn and built encampments in spring. Previous committee hearings contributed to presidential resignations at Harvard and the University of Pennsylvania, and directly preceded a police crackdown at Columbia.

In written testimony submitted ahead of the hearing, Block said he regretted not clearing the encampment sooner.

“With the benefit of hindsight, we should have been prepared to immediately remove the encampment if and when the safety of our community was put at risk,” he said.

The congressional committee is seeking to examine how universities dealt with anti-Semitism on campus since 7 October.

The committee also summoned leaders from Northwestern and Rutgers, which made deals with students to take down encampments before their commencement ceremonies, including agreeing to discuss divestment from assets tied to Israel. The two schools said they were looking forward to addressing their efforts to combat antisemitism and prioritise student safety.

Some of the toughest questions are expected to revolve around how Jewish and Israeli students were treated by activists, particularly at UCLA.

The encampment, which occupied the lawn between the California school’s library and music hall, was surrounded by metal barricades that blocked off access to the camp and the paths around it. It had about 500 people, some of whom weren’t affiliated with UCLA, Block said.

Protesters were stationed at checkpoints to ascertain who could enter, cutting off access to the front entrances of those buildings for anyone who couldn’t pass.

In some cases, which were documented on social media in late April and early May, students were barred if they identified as Zionists. In others, students were blocked because of their appearance. DM