"We trust the prime minister not to approve a freeze in Jerusalem, not in words and not in deeds."
No new Israeli housing projects in East Jerusalem have been approved since March, raising speculation that Netanyahu had imposed a de facto moratorium; that would allow the talks to proceed, while simultaneously avoiding a showdown with his far-right coalition partners.
Ramat Shlomo development
The Israeli government gave preliminary approval in Marchfor 1,600 new homes in the Ramat Shlomo neighbourhood.
But Netanyahu's announcement is unlikely to affect those homes: Construction in Jerusalem is a lengthy process, and the Ramat Shlomo project still has to receive several additional approvals before construction can begin, despite the preliminary approval.
"The final approval process will in all likelihood take more than a year and the beginning of actual construction would likely take several years," Netanyahu's office said in March.
Actual construction, in other words, was never expected to start until after Netanyahu's two-year freeze ends.
Nonetheless, Netanyahu's announcement still prompted outrage from Israeli conservatives.
Uzi Landau, the infrastructure minister and a member of the right-wing Yisrael Beiteinu party, called Netanyahu's announcementa "serious error," according to Israel's Yedioth Ahronoth newspaper.
Politicians from other nationalist parties, including Habayit Hayehudi and National Union, also released statements condemning Netanyahu's decision.
Conservative parties have threatened to withdraw from Netanyahu's governing coalition if he approves a settlement freeze in East Jerusalem.
Netanyahu has previously said that a limited halt to construction in the occupied West Bank would be observed for 10 months; he refused to extend that suspension to East Jerusalem.
A spokesman for the Jerusalem municipality did not respond to Al Jazeera's request for comment on how many construction projects will actually be affected by Netanyahu's Ramat Shlomo announcement.
The Israeli and Palestinian leaders both agreed to concessions to launch US-brokered indirect talks, which formally began on Sunday.
Talks had been suspended for 17 months, and the Palestinians had previously refused to take part unless Israel suspended all settlement activity in the West Bank and East Jerusalem.
Mahmoud Abbas, the Palestinian president, pledged to "work against incitement of any sort" in order to get the negotiations back on, according to a statementreleased by the US state department.
The indirect talks are expected to last for four months. They are the first negotiations between the two sides since Israel's three-week assault on the Gaza Strip began in December 2008.
Palestinian leaders want the talks to focus on the final borders of their future state; Netanyahu has said he is willing to discuss interim borders.