Hamas calls off attacks inside Israel

In response, Israel will hold off targeting Hamas leaders but will still go after other Palestinian militants in retaliation for a suicide bombing this week, security sources said.

Since the start of fighting in September 2000, Israel has routinely hunted down and killed militant leaders often in a manner similar to a helicopter airstrike in the Gaza Strip on Thursday.

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Three militants and two civilians were killed in the Israeli attack, which came moments before a Palestinian suicide bombing near Tel Aviv that killed four Israelis. The suicide bombing did not appear to be coordinated as retaliation for the airstrike.

Israeli officials and Palestinian militants both pledged retaliation, but Israel said it would not target Hamas leaders, reinforcing the comments by Israel's army chief of staff.

"It is no coincidence that a group like Hamas decides to stop attacks within Israel, it comes from the realization that their organisation is in danger," Maj. Gen. Moshe Yaalon told the Yediot Ahronot newspaper in an interview published Friday.

Yaalon said a truce could be achieved soon and 2004 could be the quietest year since fighting began three years ago.

"It is possible that we will reach a ceasefire in the coming weeks," Yaalon was quoted as saying. "The Palestinian-Israeli conflict will be with us for many years to come, but I believe we have now passed the peak of the violent struggle."

It was not clear when Yaalon made the comments, specifically whether he spoke before Thursday's violence. Hamas officials were not available for comment Friday so it was not clear if the group was sticking to ceasefire efforts.