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Lebanon urgently needs new gov't to avoid collapse: Hariri

Lebanon's caretaker Prime Minister Saad al-Hariri speaks after meeting with President Michel Aoun at the presidential palace in Baabda

BEIRUT (Reuters) - Lebanon needs to quickly form a new government to stop a cycle of collapse and worsening economic and security conditions, caretaker prime minister Saad al-Hariri said on Monday, after a weekend of violent confrontations shook the capital.

Beirut this weekend saw the worst violence since protests against the country's elite erupted in October, with hundreds injured as security forces deployed water cannon and rubber bullets to disperse stone-throwing protesters.

Politicians have failed to agree on a government or an economic rescue plan since the unrest pushed Hariri to quit as prime minister on Oct. 29, paralysing efforts to recover from a crisis that has shattered confidence in banks and raised investor concerns about its ability to repay steep foreign debt.

President Michel Aoun met security chiefs on Monday to work out a plan for deterring violent groups that "security services have detailed information on" while protecting property and peaceful protesters, sources at the meeting said.

Lebanon's deep financial strains have sunk the currency, pushed up prices and driven banks fearing capital flight to put strict curbs on withdrawing and transferring dollars, measures that have further fuelled rage among hard-hit Lebanese depositors.

The country's consumer protection association said it had seen "a rise in prices for the first time in Lebanon's history at rates exceeding 40% over the past three months," a statement cited by state news agency NNA said.

In a tweet, Hariri said the "continuation of the caretaker government is not the solution so let's stop wasting time and have the government bear the responsibility."

Last month little-known former minister Hassan Diab was designated prime minister with the backing of heavily armed Shi'ite group Hezbollah and its allies, but a deal on a cabinet has yet to be announced.

"Our government resigned in order to transition to a new government dealing with popular changes but obstruction has continued for 90 days and the country is moving toward the unknown," said Hariri.

(Reporting by Beirut newsroom; Writing by Eric Knecht Editing by Toby Chopra, William Maclean)