Ehud Olmert, Israel’s prime minister, has announced a unilateral truce in the Gaza Strip.
Israel will halt its offensive in Gaza at 0000 GMT on Sunday but troops will remain in the enclave for the time being and will respond to Hamas fire, Olmert said on Saturday.
The announcement came after a meeting of Israel’s security council on Saturday evening and halts the 22-day offensive which has left more than 1200 Palestinians dead, more than 400 of them children.
"We have reached all the goals of the war, and beyond," Olmert said.
"If our enemies decide to strike and want to carry on then the Israeli army will regard itself as free to respond with force," he added.
Alan Fisher, Al Jazeera’s correspondent on the Gaza-Israel border, said: "What the Israelis are doing by this unilateral declaration is taking all the power into their own hands and they will almost dictate now what happens, and when.
"Ehud Barak [the defence minister] has been quoted … as saying that Israel has achieved almost all its goals.
"So it would seem that Israel is happy now to call it quits to this operation, believing that it has done all it set out to do," he said.
Hamas said it would continue fighting in Gaza as long as Israeli troops remained in the Hamas-ruled Strip.
"If the Israeli military continues its existence in the Gaza Strip, that is a wide door for the resistance against the occupation forces," Osama Hamdan, a Hamas official in Lebanon told Al Jazeera.
Fawzi Barhum, a Hamas spokesman, said: "The Zionist enemy must stop all its aggression, completely withdraw from the Gaza Strip, lift the blockade, and open the crossings. We will not accept the presence of a single soldier in Gaza."
"The enemy’s declaration of a unilateral ceasefire confirms that this is a unilateral war launched in one direction, from the enemy upon our people," Barhum, who is in Gaza, said in a statement.
Speaking at a forum in Beirut, Hamdan called on Arab leaders to stand by the Palestinian "resistance" and urged European nations to cut ties with Israel for its "crimes" in Gaza.
Reduce Rocket Fire
About 1,230 Gazans have been killed in Gaza since the offensive began, according to UN and Palestinian medical sources.
At least 13 Israelis have died, three of them civilians.
Israel decided on a unilateral ceasefire in preference to entering into an Egyptian-brokered ceasefire with Hamas, which rules the Gaza Strip, analysts said.
The unilateral truce allows Israel to avoid agreeing concessions with the Palestinian group, such as easing the 18-month-old blockade of the Gaza Strip, which has prevented medical aid and basic supplies from reaching the Palestinians.
Egypt has been pushing Israel and the rival Palestinian factions to reach an agreement. A Hamas delegation had returned to Cairo on Friday for a second round of talks.
Fisher said: "Israel could almost go it alone now because of the role Egypt is playing in talking to Hamas and this deal, as Israel sees it, isn’t with Hamas – it is something they are doing on their own.
"The Israelis can dictate when they pull their troops back – they don’t need Egypt saying: ‘This is the table you signed up to’."
Hamas officials said earlier on Saturday they would ignore any Israeli cessation of the conflict and continue fighting.
"Clearly, we have nothing new to propose … either we hear what we have proposed [is accepted] or we will go back to the battlefield," Osama Hamdan, Hamas’s representative in Lebanon, said.
"The [large] number of our martyrs will not push us to surrender, but to insist on resistance."
Israel’s stated aim of the war, which it dubbed Operation Cast Lead, has been to reduce Palestinian rocket attacks on southern Israel.
On the first day of the offensive up to 100 rockets were fired from Gaza into Israel. In the past few days up to 20 have hit Israel on a daily basis.
(Aljazeera and Agencies)