President Vladimir Putin castigated the United States Friday for bringing sanctions and expelling Russian diplomats amid allegations of Russian meddling in the American presidential election, but said no US diplomats will be ousted in reprisal for Washington's moves in the wake of hacking attacks.

In a burgeoning controversy surrounding complaints from the Obama administration about a cyber assault against America's political system, the White House on Thursday unleashed a string of sanctions and coupled them with an order that 35 Russians be expelled.

In a statement Friday on the Kremlin's web site, Putin referred to the sanctions as a "provocation aimed to further undermine Russian-American relations." But he also said that Moscow would not be ousting American diplomats.

REUTERS US President Barack Obama and Russia's President Vladimir Putin have always had a frosty relationship.

"The Russian diplomats returning home will spend the New Year Holidays with their relatives and dear ones," Putin said. "At home. We will not create problems for US diplomats. We will not expel anybody."

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The diplomatic confrontation between Washington and Moscow, which had been festering even before the November 8 presidential election elevated Donald Trump to the presidency, puts pressure on the billionaire businessman not to let Russia off the hook after he takes office on January 20.

LEHTIKUVA Russian Prime Minister Dmitry Medvedev tweeted "RIP" to Russian-US relations.

Russia's government had threatened retaliation, and it continues to deny US accusations that it hacked and stole emails to try to help Trump win.

Trump said the US should move on, but in a sign he was no longer totally brushing off the allegations, he plans to meet with US intelligence leaders next week to learn more.

CALL FOR RUSSIA TO EXPEL DIPLOMATS

Putin's statement came hours after Foreign Minister Sergey Lavrov suggested a tit-for-tat expulsion in televised remarks.

He said early Friday that Russia's foreign ministry and other agencies had suggested that Putin order expulsion of 31 employees of the US Embassy in Moscow and four diplomats from the US Consulate in St. Petersburg.

Another suggestion is to bar American diplomats from using their summer retreat on the outskirts of Moscow and a warehouse south of Moscow.

But in the web site remarks, Putin said, Russia would not prevent the families and children (of diplomats) from using the customary rest and leisure facilities and sites during the New Year holidays.

"Moreover, I am inviting all children of US diplomats accredited in Russia to the New Year and Christmas parties in the Kremlin," he said.

President Barack Obama on Thursday ordered sanctions against the GRU and FSB, leading Russian intelligence agencies the US said were involved.

In an elaborately coordinated response by at least five federal agencies, the Obama administration also sought to expose Russia's cyber tactics with a detailed technical report and hinted it might still launch a covert counterattack.

"All Americans should be alarmed by Russia's actions," said Obama, who was vacationing in Hawaii.

He added, "Such activities have consequences."

He said the response wasn't over and the US could take further, covert action - a thinly veiled reference to a counterstrike in cyberspace the US has been considering.

Yet the sanctions could easily be pulled back by Trump, who has insisted that Obama and Democrats are merely attempting to delegitimise his election.

'RIP' RUSSIA-US RELATIONS

Prime Minister Dmitry Medvedev charged earlier Friday that Washington has become immersed in "anti-Russian death throes."

Medvedev, who focused on improving US-Russia ties when he was president from 2008-2012, called the latest diplomatic breach "sad" in a Twitter post.

It is regrettable that the Obama administration, which started out by restoring our ties, is ending its term in an anti-Russia agony. RIP — Dmitry Medvedev (@MedvedevRussiaE) December 30, 2016

As part of the punishment levelled against Moscow, the US kicked out 35 Russian diplomats, in response to Russia's harassment of US diplomats. They also shut down Russian recreational compounds in New York and Maryland that US officials said were being used for intelligence.

It was the strongest action the Obama administration has taken to date to retaliate for a cyberattack, and more comprehensive than last year's sanctions on North Korea after it hacked Sony Pictures Entertainment. The new penalties add to existing US sanctions over Russia's actions in Ukraine, which have impaired Russia's economy but had limited impact on Putin's behaviour.

Russia called the penalties a clumsy yet aggressive attempt to "harm Russian-American ties." Putin spokesman Dmitry Peskov said Russia would take into account the fact that Trump will soon replace Obama as it drafts retaliatory measures.

US relations with Russia have suffered during Obama's years in office as he and Putin tussled over Ukraine, Edward Snowden and Russia's support for Syrian President Bashar Assad. Maria Zakharova, a Russian foreign ministry spokeswoman, took to Facebook to call the Obama administration "a group of foreign policy losers, angry and ignorant."

It was unlikely the new sanctions, while symbolically significant, would have a major impact on Russian spy operations. The sanctions freeze any US assets and block Americans from doing business with them. But Russian law bars the spy agencies from having assets in the US, and any activities they undertake would likely be covert and hard to identify.

"On its face, this is more than a slap on the wrists, but hardly an appropriate response to an unprecedented attack on our electoral system," said Stewart Baker, a cybersecurity lawyer and former National Security Agency and Department of Homeland Security official.

Indeed, senior Obama administration officials said that even with the penalties, the US had reason to believe Russia would keep hacking other nations' elections and might well try to hack American elections again in 2018 or 2020. The officials briefed reporters on a conference call on condition of anonymity.

Though the FBI and Department of Homeland Security issued a joint report on "Russian malicious cyber activity" - replete with examples of malware code used by the Russians - it still has not released a broader report Obama has promised detailing Russia's efforts to interfere with US elections.

The report has been eagerly anticipated by those hoping to make it politically untenable for Trump to continue questioning whether Russia was really involved. But US officials said those seeking more detail about who the US has determined did the hacking need look only to the list of sanctions targets, which includes the GRU head, his three deputies, and two Russian nationals wanted by the FBI for cybercrimes.

The move puts Trump in the position of having to decide whether to roll back the measures once in office, and US officials acknowledged that Trump could use his executive authorities to do so. Still, they suggested that building the case against Russia now would make it harder for Trump to justify easing up.

US allegations of hacking have ignited a heated debate over Trump's approach to Russia and his refusal to accept the assessment of US intelligence agencies that Russia's government was responsible and wanted to help him win. Though US lawmakers have long called for Obama to be tougher on Russia, some Republicans have found that position less tenable now that Trump is floating the possibility of closer ties to Moscow.

"While today's action by the administration is overdue, it is an appropriate way to end eight years of failed policy with Russia," said House Speaker Paul Ryan, R-Wis.

US intelligence agencies concluded that Russia was trying to help Trump when hackers connected to the government breached Democratic Party computers and stole tens of thousands of emails that were then posted on WikiLeaks, some containing embarrassing information about Democrats. Clinton aide John Podesta's emails were also stolen and released publicly in the final weeks of the campaign.