Turkey's prime minister said on Friday his cabinet had authorized the armed forces to conduct a cross-border operation against Kurdish PKK rebels in northern Iraq, but analysts said major action did not appear imminent.

Tayyip Erdogan's comments, following up on a parliamentary resolution last month and emergency talks with U.S. President George W. Bush, seemed chiefly designed to keep up pressure on U.S. and Iraqi forces to honor pledges to tackle the PKK.

We took our cabinet meeting decision on November 28 and with the president's approval our Turkish Armed Forces are now authorized for a cross-border operation from November 28, Erdogan said in televised comments.

Turkey has amassed up to 100,000 troops near the mountainous border, backed up by tanks, artillery and warplanes, for a possible strike into mainly Kurdish northern Iraq against rebels of the outlawed Kurdistan Workers Party (PKK) hiding there.

Ankara has made many threats of military action but, under heavy U.S. pressure, has so far shown restraint. Washington fears a large-scale operation could destabilize the most stable part of Iraq and possibly the wider region.

There was a muted reaction in financial markets to Erdogan's comments, with the lira weakening slightly against the dollar.

Turkey's parliament approved a resolution on October 17 giving the government the legal basis to order cross-border military operations if and when it deemed them necessary.

The resolution, approved by an overwhelming majority of lawmakers, followed a series of deadly PKK attacks on Turkish security forces that fanned an angry wave of nationalism across Turkey, a NATO member that also wants to join the EU.

That resolution is valid for one year. The cabinet decision this week effectively frees up the generals to act as they see necessary without seeking further political approval.

TACTICAL MOVE

They (the government) want to keep up the pressure. If you let go, both the Americans and the Kurdish administration in northern Iraq may relax their positions. It is a tactical move, said Dogu Ergil, a professor at Ankara University.

Intelligence reports show about 2,000 of the rebels have passed into Iran and a further 1,000 into Turkey, leaving only about 500 or so in caves in the Qandil mountains (of northern Iraq). This is not worth a major military operation, he said.

Weather conditions are also rapidly worsening, further hampering the likely effectiveness of military action.

But analysts said it would be wrong to think the Turks were only bluffing. Another deadly PKK attack inside Turkey could prove the tipping point.

Erdogan's words show the Turks do mean business this time. They are serious. They will not be satisfied with just promises from the Americans and Iraq, said Wolfango Piccoli, a Turkey expert at Eurasia Group, a political risk consultancy.

Erdogan held emergency talks with Bush on November 5 in the White House, wringing from him pledges of closer cooperation, including more intelligence sharing against a group Washington also brands as terrorist.

Three top U.S. generals have visited Ankara in the past 10 days to discuss intelligence sharing with the Turkish military.

Northern Iraqi Kurdish authorities have also taken steps to stop supplies reaching the PKK rebels in the mountains.

But government ministers repeated again this week that they expected more concrete action from U.S. and Iraqi forces against the PKK, blamed by Ankara for the deaths of nearly 40,000 people since the group began its armed separatist insurgency in 1984.

George W. Bush Iraq