Israeli strike kills 2 Palestinians in Gaza

GAZA, Aug 5 (Reuters) An Israeli air strike killed two Palestinians in southern Gaza early today as troops inched closer to a refugee camp in the area, Palestinian medics and witnesses said.

Medics said a missile fired by an Israeli aircraft slammed in front of a house in the town of Rafah, killing two and wounding several members of a family, who had been fleeing the home amid what witnesses said was increasing Israeli gunfire.

Two children were among the wounded, medics said.

An Israeli army spokesman said the only strikes the military had carried out in Gaza close to the time of the attack took place about 2 km away from Rafah, in which two gangs of Palestinian militants were targeted.

Israeli forces swept into the Rafah area on Thursday to destroy what the army called ''terrorist infrastructure'' as part of a wider offensive against militants, launched after gunmen captured an Israeli soldier in a cross-border raid on June 25.

Palestinian witnesses said that minutes before the strike, Israeli tanks rolled closer to Rafah's refugee camp and that troops had taken over a nearby Palestinian security post and shots were fired in the area.

An Israeli army spokesman had said there was military activity in the territory and that he was checking the report.

Israel's Gaza offensive has killed at least 165 Palestinians, more than half of them civilians.

Israel killed three Palestinians in the Gaza Strip yesterday as it launched a series of air strikes on militant targets that wounded four other people, witnesses and medics said.

Israeli troops in the Rafah area have already taken over a 3-5 sq km area, carried out house-to-house searches and destroyed greenhouses and chicken farms.

Israel has rejected demands by militant groups that captured Corporal Gilad Shalit in the raid, including the armed wing of the leading Hamas faction, to exchange the soldier for Palestinian prisoners.

Israel's offensive has increased pressure on Hamas, which rose to power in March, and had been under a Western aid embargo to try to force it to recognise Israel, renounce violence and accept peace deals.

Reuters VJ GC0506