Palestinian President Mahmoud Abbas has said the new unity government that he is set to head with the backing of Hamas would reject violence and recognise Israel and existing agreements.

Abbas spoke on Saturday to the Palestinian Central Council, a top decision-making body, two days after Israel halted negotiations with the Palestinians over a reconciliation deal between Abbas' Fatah party and Hamas movement.

Israel said it would not negotiate with a government backed by Hamas, the Islamist movement ruling the Gaza Strip, which is pledged to the destruction of Israel.

The Fatah-Hamas deal envisions an interim government in a month and general elections by winter.

Abbas, who heads the Palestinian Authority and Fatah, said any unity government would work "under my orders and my policy".

"I recognise Israel and reject violence and terrorism, and recognise international commitments."

Abbas also said he was still ready to extend stalled US-sponsored peace talks with Israel, as long as it met his long-standing demands to free prisoners and halt building on occupied land.

Israel and the US had been hoping to extend the faltering talks, which were launched last July, beyond their April 29 deadline, but the efforts hit a wall last month when Israel refused to release a final batch of Palestinian prisoners.

Palestinians accused Israel of not focusing enough during the last nine months of negotiations on drawing future borders between Israel and the future state of Palestine. Palestinians also denounced the expansion of Jewish settlements on occupied land.

Israel accuses Abbas of being more interested in healing the national rift with Hamas than achieving a peace deal.