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"Israeli and Hamas officials are discussing a possible ceasefire through Egyptian mediators after Ehud Olmert, Israel's prime minister, ordered a halt to raids on the Gaza Strip.
Olmert gave the order on Monday in response to a significant drop in the number of rockets and mortars being fired from the territory, offficials said.
"We certainly appear to have entered a period of talking rather than fighting now," Al Jazeera's Jacky Rowland reported from Gaza.
"For more than three days now there have been virtually no rocket attacks into Israel ... and also there have been no Israeli air strikes, no overflights of Gaza."
Both Israeli defence officials and Hamas leaders have insisted that no formal truce has been agreed so far, but officials in Olmert's office told the Associated Press that he had ordered the army to scale back its operations to allow talks to proceed."
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