State Department’s official William Burns told lawmakers about the decision in a meeting with members of the House and Senate, unnamed US officials told the Associated Press.
Washington remained silent following the coup, but the new announcement would pave the way for the United States to continue providing $1.5 billion in annual aid to the African state.
Under US law, financial assistance to any country whose elected head of state is deposed in a military coup is prohibited.
In an interview with Press TV, political analyst Michael Burns said the United States is trying to protect the interests of Israel regarding the recent chaos in Egypt.
“In respect to Egypt, we are trying to protect the interests of Israel,” he said.
The White House is concerned that halting such funding to Egypt could imperil programs that help secure Israel.
The United States supplies about $1.5 billion in annual aid to Egypt, the second largest recipient of U.S. aid after Israel. Cairo has received more than 70 billion dollars in military and economic aid from the United States since 1948.
Egypt has been the scene of rallies held by anti and pro-coup protesters after the country’s army ousted Morsi on July 3. Morsi has been held at an undisclosed location since his overthrow.