Gaza/Occupied Jerusalem: Israeli air strikes killed at least eight Palestinians in the Gaza Strip and fighters kept up their cross-border rocket fire on Monday as Israel moved to cushion its economy against the effects of a war now in its seventh week.
Egypt pressed on with efforts to broker a durable truce, and the Bank of Israel, fearing the conflict would slow economic growth, cut its benchmark interest rate by a quarter-point to 0.25 per cent, its lowest level ever.
Gazans said they received new recorded messages on mobile phones and landlines saying Israel would target any house used to launch "terror attacks" and telling civilians to leave areas used by fighters.
Israeli aircraft attacked four homes in the town of Beit Lahiya, near the Israeli border, killing two women and a girl, witnesses and health officials said.
Locals said a member of the Hamas fighters group that dominates Gaza lived in one of the dwellings. Five other Palestinians were killed in Israeli strikes, including three men in an attack on a car, officials said.
More than 80 rockets were launched at southern Israel on Monday, causing no casualties, the army said.
Palestinian health officials say 2,122 people, most of them civilians, including more than 400 children, have been killed in Gaza since July 8, when Israel launched an offensive with the declared aim of ending rocket fire into its territory.
Sixty-four Israeli soldiers and four civilians in Israel have been killed.
Gazans said they had received messages on their phones for several days, with a new recording on Monday ending with the words: "To Hamas leaders and to the residents of Gaza: The battle is open and you have been warned."
Qais Abu Leila, a senior Palestinian official involved in Egyptian-mediated talks to reach a truce, said Cairo had proposed an indefinite ceasefire.
Cairo's latest initiative calls for the immediate opening of Gaza's crossings with Israel and Egypt to aid reconstruction efforts in the battered coastal strip, to be followed by talks on a longer-term easing of the blockade.
"Egyptian efforts are continuing. The ball is in the Israeli court, and they have not responded to this proposal 36 hours after it was referred to them," Abu Leila said.
Hamas has said it will not stop fighting until the Israeli-Egyptian blockade on the enclave of 1.8 million people is lifted.
Both Israel and Egypt view Hamas as a security threat and are demanding guarantees that weapons will not enter the economically-crippled territory. Israel recalled its negotiators from Cairo last Tuesday after a ceasefire collapsed.
Announcing its surprise interest rate cut, the Bank of Israel said it was too soon to assess precisely the loss of economic growth that will derive from the fighting.
But it said the war could shave half a point off GDP, which is forecast at 2.9 per cent in 2014, as tourism and consumer spending are hit.
In Gaza City on Sunday, an Israeli strike on a car killed Mohammed Al Ghoul, described by the Israeli military as a Hamas official responsible for "terror fund transactions".
Israel later bombed and destroyed Ghoul's house. He was targeted three days after Israel killed three top Hamas commanders in the southern Gaza Strip.
Thousands of homes in the Gaza Strip have been destroyed or damaged in the conflict. Nearly 500,000 people have been displaced in the territory where Palestinians, citing Israeli attacks that have hit schools and mosques, say no place is safe.
Israel has said Hamas bears responsibility for civilian casualties because it operates among non-combatants. The group, it said, uses schools and mosques to store weapons and as launching sites for cross-border rocket attacks.