Israel and Hamas have signed off on the first phase of the US-proposed Gaza deal, allowing for the release of all Israeli hostages, US President Donald Trump announced on Wednesday.

"I am very proud to announce that Israel and Hamas have both signed off on the first Phase of our Peace Plan," Trump said on Truth Social.

"This means that ALL of the Hostages will be released very soon, and Israel will withdraw their Troops to an agreed upon line as the first steps toward a Strong, Durable, and Everlasting Peace," Trump added.

The announcement comes a day after the second anniversary of Hamas` attack on Israel that triggered Israel`s devastating assault on Gaza.

Gaza authorities say more than 67,000 people have been killed and much of the enclave has been flattened since Israel began its military response to the Hamas cross-border attack on Oct 7, 2023.

Around 1,200 people were killed and 251 were taken hostage back to Gaza, according to Israeli officials, with 20 of the 48 hostages still held believed to be alive.

Earlier on Wednesday, Trump said that he might travel this weekend to Egypt, where his envoys were in talks to try to seal the ceasefire and hostage-release agreement.