Russian President Vladimir Putin said that he hopes when President-elect Donald Trump takes office, Moscow and Washington will be able to take "real steps" to improve relations between the two countries.
Putin made the comments in a New Year's congratulatory message to Trump, and comes after a tense few days in which the US accused Russian intelligence agencies of being involved in hacking around the US election, and issued further sanctions.
Putin also added that positive developments in relations between Russia and Britain would be mutually beneficial.
President Vladimir Putin says Russia won't be expelling US diplomats in response to a new round of US sanctions, which includes 35 Russian diplomats begin given 72 hours to leave the country.
In withering comments, he criticised the US sanctions, saying he would wait for Donald Trump to be inaugurated before deciding on further action, and even invited US diplomats and their families to a party in the Kremlin.
In a statement on Friday, he said: "We will not expel anyone. While keeping the right for retaliatory measures, we will not descend to the level of 'kitchen', irresponsible diplomacy.
"Further steps towards the restoration of Russian-American relations will be built on the basis of the policy which the administration of President D. Trump will carry out."
He also said the government would not seek to bar US diplomats from their usual holiday spots, adding: "Moreover, I invite all children of American diplomats accredited in Russia to the New Year and Christmas party in the Kremlin."
Russia's Foreign Minister Sergey Lavrov has proposed a tit-for-tat move against the US, after it sanctioned Russia over what he says are baseless accusations of interference in the US elections.
Lavrov has proposed that President Vladimir Putin expel 31 employees of the US embassy in Moscow and four diplomats from the US consulate in St Petersburg.
He also suggested that Putin bar US diplomats from using their summer retreat and a warehouse in Moscow.
Yesterday US administration without presenting any evidence or proof, announced the new wave of sanctions against the Russian Federation.
We cannot leave such steps unanswered, reciprocity is a law of diplomacy and international affairs, therefore Russian foreign ministry together with our colleagues from other agencies, proposed the president of the Russian Federation to declare 31 staff members of the US embassy in Moscow and four diplomats from the US Consulate General in St Petersburg persona non grata.
Besides we offered to ban Americans from using their country house in Serebryany Bor and a warehouse on Dorozhnaya street.
The call comes after President Obama imposed sanctions on two Russian intelligence agencies over their alleged involvement in hacking US political groups in the run-up to the election.
He also ordered 35 Russian diplomats to leave the US within 72 hours, and closed two facilities used by the Russians.
A Kremlin spokesperson said that it is up to President Putin to draft any retaliatory measures.
The US has released a report on accusations that Russia interfered in the US presidential election by hacking American political sites and email accounts.
The 13-page document by the Department of Homeland Security and the FBI is the first report to attribute hacking to a particular country or individuals.
It is also the first time the US has officially tied intrusions into the Democratic National Committee to hackers with the Russian civilian and military intelligence services, the FSB and GRU, expanding on an accusation made by the Obama administration in October.
The report said the intelligence services were involved in "an ongoing campaign of cyber-enabled operations directed at the US government and its citizens."
It added: "In some cases, (the Russian intelligence services') actors masqueraded as third parties, hiding behind false online personas designed to cause the victim to misattribute the source of the attack."
Over the summer stolen emails from Democrats were posted by an online persona known as Guccifer 2.0, believed by US officials to be linked to Russia.
Outrage over documents that appeared to show favouritism for Hillary Clinton forced the DNC's chair, Debbie Wasserman Schultz, to resign.
Russia's Prime Minister has said it is "regrettable" that the Obama administration is ending its term in office "in an anti-Russian agony".
Dimitry Medvedev's comments came after the US expelled 35 Russian diplomats from the country and gave them 72 hours to leave.
Two Russian compounds in New York and Maryland have also been closed down and individuals sanctioned in response to alleged cyber hacking of the US election and harassment of American diplomats in Moscow.
Downing Street said it was "not appropriate" for John Kerry to brand the Netanyahu administration as the "most right wing in history".Read the full story ›
US President-elect Donald Trump has said he will meet with intelligence leaders next week to get the "facts of the situation" that led the Obama administration to expel 35 Russian diplomats in the wake of cyber attacks related to the US election.
The statement from Mr Trump urged America to "move on to bigger and better things" but confirmed he would meet security officials "in the interest of our country and its great people".
It's time for our country to move on to bigger and better things. Nevertheless, in the interest of our country and its great people, I will meet with leaders of the intelligence community next week in order to be updated on the facts of this situation.
The Kremlin has warned the expulsion may lead to retaliatory actions.
Mr Trump has previously dismissed as "ridiculous" claims Russian cyber-hackers had interfered with the US election process.
Russia has said it regrets the US's move to expel 35 of its diplomats and impose sanctions on individuals in response to alleged hacking and harassment.
A Kremlin spokesman described the step as a sign of Washington's "aggressive foreign policy."
Moscow warned that its own retaliations would be "adequate," adding that President Vladimir Putin would decide how to respond.
Russia also labelled the move by Barack Obama "unlawful" and questioned the efficiency of the latest tactic.
The spokesperson said the sanctions had the potential to damage diplomatic relations between the two countries, adding that he was unsure if incoming President Donald Trump would approve of such a move.
Russia's UK embassy responded to news that Barack Obama had expelled 35 of its diplomats from the US with a picture of a "lame duck".
The embassy tweeted a picture of a baby duck with the word "lame" superimposed on it.
Included was a message that read: "President Obama expels 35 [Russian] diplomats in Cold War deja vu.
"As everybody, incl people, will be glad to see the last of this hapless Adm."
The move is a response to alleged campaigns of harassment against American diplomats in Moscow.Read the full story ›