The deal is set to include two stages: An oral agreement on both sides to hold fire, followed by a written agreement for a one-year truce at least.
According to the Egyptian report, Hamas strongman Mahmoud al-Zahar is expected to return to Cairo with a positive answer to the proposals presented to the organization by Egypt. Turkey was also said to be involved in the talks.
Israel expects the release of kidnapped soldier Gilad Shalit to be included in the truce agreement along with the reopening of the Gaza Strip's crossings. The past few days have seen many reports on progress made in the indirect talks on this matter, including some flexibility on both sides.
Defense Minister Ehud Barak declared that Operation Cast Lead had advanced the changes to secure Shalit's release. He expressed his hope that the captive soldier will return home before a new government is sworn in.
Arab newspapers reported Monday morning that Israel had expressed its willingness to release most of the senior prisoners demanded by Hamas, excluding Popular Front for the Liberation of Palestine Secretary-General Ahmad Saadat, who was responsible for the assassination of Minister Rehavam Ze'evi, and three other prisoners.