Treasury Secretary Janet L. Yellen cautioned Israel against severing ties between Palestinian and Israeli banks, stating that it would exacerbate the economic instability in the West Bank. Her remarks followed Israel's decision to withhold tax revenue from the Palestinian Authority in response to European countries recognizing a Palestinian state. Yellen emphasized the importance of banking channels for crucial transactions, warning that cutting off Palestinian banks from Israel would severely impact the economy. She also criticized the decision to restrict Palestinian access to tax revenues, emphasizing the need for increased humanitarian assistance and economic stability in the West Bank. Yellen had previously urged Israel to enhance commercial engagement with the West Bank for the mutual economic benefit of both Israelis and Palestinians.