Israeli Prime Minister Ehud Olmert ordered the Israeli army today to halt military operations against Palestinian militants in Gaza as long as there is no rocket fire against Israeli targets.
Despite fears of an increase in violence after Thursday's shooting attack in Jerusalem, the last few days have been unusually quiet.
At the height of the recent spike in violence, almost 50 rockets were being fired every day. This weekend there were hardly any launched .
Israeli officials have refused to admit to any deal with Hamas, but Mark Regev, the Israeli prime minister's senior spokesman, told ABC News that Israel would respond if it was fired upon.
"If there was no fire from Gaza, Israel would have no reason to respond," he said.
Comments appear to contradict recent Israeli government statements threatening continued military action against Hamas and other factions in Gaza.
According to one unnamed government official quoted in the Israeli press, new ground rules were established during Secretary of State Condoleezza Rice's recent visit and messages were exchanged behind the scenes, between Israel and Hamas using Egyptian mediation.
Amos Gilad, a senior Israeli defense official, a veteran of previous negotiations, has just returned from talks in Cairo. While no official statements have been released there is growing evidence of an initiative to lower the level of violence.
Palestinian sources claim the Egyptians, whose intelligence chief is due in Israel later this week, are trying to arrange a package of measures to build on the present lull.
Such measures would include Israel lifting its strict blockade of food and other supplies in return for continued quiet. New arrangements would allow forces loyal to moderate Palestinian President Mahmoud Abbas to re-enter Gaza to run its border crossings, according to these reports.
Such arrangements would attempt to resuscitate the 2005 U.S.-brokered agreement on Gaza's border crossings, which was established after Israel's unilateral withdrawal from the coastal territory.
Israel and its U.S. allies have always refused to deal with Hamas, whose militant charter still retains a clause calling for the Jewish state's destruction.
Any covert contacts with the militant Islamic group that now controls Gaza could cause embarrassment. Regev told ABC News "Israel has no intention of negotiating with Hamas or recognizing its rule in Gaza."
But today's swirling rumors and flurry of anonymously sourced reports suggest a dialogue of sorts, even if it is not direct.