A cautious calm returned to Ain el-Hilweh Palestinian camp in south Lebanon Thursday after a night of renewed clashes.

Lebanon's largest Palestinian refugee camp, which is home to about 50,000 people, has been racked since Sunday by fierce battles between President Mahmoud Abbas' Fatah party and Islamist groups Jund al Sham and Shabab al Muslim.

Dialogue between Hezbollah and the Free Patriotic Movement has made progress on the files of decentralization and the trust fund and will move next week to the file of the presidency, a media report said.

Official political sources have cast doubt on the success chances of the dialogue that French envoy Jean-Yves Le Drian has called for in a bid to break the presidential deadlock.

The Central bank is inclined to stop funding the state completely as of Monday, MTV said, after the government and parliament failed to pass a law that would allow the government to borrow foreign currency from the central bank.

First central bank vice-governor Wassim Mansouri, who took over as BDL's acting governor on Tuesday, had urged parliament and the government to cooperate in order to legalize spending during a transitional period before the central bank stops funding the state completely.

Hamas leader Ismail Haniya has contacted Hezbollah chief Sayyed Hassan Nasrallah, Speaker Nabih Berri and caretaker PM Najib Mikati, urging them to exert efforts to halt the deadly clashes that have been raging for six days at the Ain al-Helweh Palestinian refugee camp in south Lebanon.

Caretaker Prime Minister Najib Mikati has clarified that no Cabinet session will be held at the summer seat of the Maronite patriarchate in Diman but rather a ministerial meeting.

Heavy clashes resumed Wednesday night in a Palestinian refugee camp in south Lebanon, ending a cease-fire there following a day of relative calm.

The clashes between Palestinian factions at the Ain al-Helweh camp have pitted members of President Mahmoud Abbas' Fatah party against Islamist groups accused of gunning down Palestinian military general Abu Ashraf al Armoushi on Sunday.

Caretaker Prime Minister Najib Mikati held talks Wednesday in Diman with Maronite Patriarch Beshara al-Rahi.

Parliament Speaker Nabih Berri is upset by caretaker Prime Minister Najib Mikati's attempt to evade passing a law that would allow the government to borrow foreign currency from the central bank, al-Akhbar newspaper said Wednesday.

First central bank vice-governor Wassim Mansouri, who took over as BDL's acting governor on Tuesday, urged parliament and the government to cooperate in order to legalize spending during a transitional period before the central bank stops funding the state completely.

Caretaker Interior Minister Bassam Mawlawi has denied the presence of a “terror plot” behind the deadly clashes that rocked the Ain al-Helweh Palestinian refugee camp over the past four days.

There is no “terror plot being implemented in Lebanon as some are saying,” Mawlawi said in a TV interview, calling on politicians to “perform their duties to the fullest, especially that security and military forces are carrying out their duties.”