Yemen clashes
Houthi fighters take up position on a street during clashes near the Presidential Palace in SanaaKhaled Abdullah Ali Al Mahdi/Reuters

Yemeni authorities say a ceasefire deal has been reached following fierce clashes between army forces and Houthi Shia fighters near the presidential palace in capital Sanaa.

Gunfire and explosions were heard in the region around the palace for several hours.

Yemen's Information Minister Nadia Sakkaf told Associated Press that President Abed Rabbo Mansour Hadi will hold talks with the representatives of the Shia Houthi rebels later in the day to address the situation.

The president was not at his official residence when the clashes broke out. Details of fatalities remain sketchy but local media reports suggest that there were dead bodies lying on the streets.

The rebels and Yemeni forces blame each other for provoking the attack, which took places two days after the president's chief of staff was abducted.

Schools have been shut and roads have been cordoned off owing to the violent fighting in the city, with reports indicating that automatic rifles and rocket-propelled grenades were being employed from both sides.

Several residents are said to have fled the area, where the Houthi rebels - who hail from the minority Zaidi Shia community – have been patrolling since they overran the city in September last year.

Though an UN-brokered deal was achieved earlier between the Yemeni government and Houthi rebels that the radicals will move out of Sanaa once the unity government is in place. However, the fighters do not seem to back down and continue to advance into Sunni-dominated territories in western and central parts of Yemen.

The Houthis have been revolting against the administration since 2004 to carve a greater power for their heartland northern province Saada.