CAIRO - Egypt's interim rulers welcomed on Thursday remarks from the US State department describing the rule of toppled leader Mohamed Morsi as undemocratic, clearly hoping they signaled Washington would not cut off its $1.5 billion in annual aid.

In a stark illustration of the desperate state of Egypt's economy, a former minister from Morsi's ousted government said Egypt has less than two months' supply left of imported wheat, revealing a far worse shortage than previously disclosed.

The army's removal of Egypt's first democratically elected leader last week, after millions took to the streets to protest against him, has left the Arab world's most populous country polarized by divisions unseen in its modern history.

Violence between supporters of Morsi and soldiers at a military compound this week has deepened the fissures.

Washington has been treading a careful line. US law bars aid to countries where a democratic government is removed in a coup. So far Washington has said it is too early to say whether the Egyptian events met that description.

Nevertheless, State Department spokeswoman Jen Psaki said on Wednesday, Morsi's government "wasn't a democratic rule".

"What I mean is what we've been referencing about the 22 million people who have been out there voicing their views and making clear that democracy is not just about simply winning the vote at the ballot box."

Egypt's Foreign Ministry spokesman, Badr Abdelatty, said the comments "reflect understanding and realization ... about the political developments that Egypt is witnessing in the recent days, as embodying the will of the millions of Egyptians who took to the streets starting on June 30 to ask for their legitimate rights and call for early elections".

In the days before Morsi's downfall, the US ambassador in Cairo attracted sharp criticism from Morsi's opponents for a speech that stressed that Morsi was democratically elected and discouraged street protests against him.

The White House on Monday refused to label the ouster of Egypt's president a military coup and said there would be no immediate cut-off in US aid to Egypt. US officials have since said they are still reviewing the matter. In the past, the US government has taken more than two months to make up its mind on such questions.

Anti-American sentiment rampant in recent weeks

Both sides in Egypt have become more anti-American in recent weeks. Morsi's opponents say US President Barack Obama's administration supported the Muslim Brotherhood in power, while Morsi's supporters believe Washington was behind the plot to unseat him.

"Obama supports democracy, but only if it goes to those who aren't Islamists," heavily bearded Morsi supporter El-Sayyed Abdel Rabennabi said at the Brotherhood vigil.

On Tahrir Square, where Morsi's opponents gather, the animosity is no less fierce.

"America made an alliance with the Brotherhood against the Egyptian people," said aircraft mechanic Tawfiq Munir at a recent rally there. "Now the Brotherhood are fighting us in the streets, fighting to take back power, and America is sitting on the fence."

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