Iraqi government forces have halted their offensive to seize control of western Mosul from Islamic State (Isis) due to heavy civilian casualties from a US-led coalition air strike, a spokesperson for the security forces said.

"The recent high death toll among civilians inside the Old City forced us to halt operations to review our plans. It's a time for weighing new offensive plans and tactics. No combat operations are to go on," the spokesperson said.

"We need to make sure that taking out Daesh (Islamic State) from the Old City will not cost unwanted high casualties among civilians. We need surgical accurate operations to target terrorists without causing collateral damage among residents," he added.

The development comes as the US Central Command admitted for the first time that the coalition forces conducted an air strike against Isis in Mosul that may have killed at least 200 civilians.

In a statement, Centcom said an initial review revealed that the strike was carried out "at the request of Iraqi forces" and insisted that the raid hit Isis jihadists and equipment.

The strike on 17 March in al-Jadida district of west Mosul is under investigation. It is said to be one of the deadliest air strikes since the US invaded Iraq in 2003.

A clear picture of what actually happened is yet to emerge, but according to a local lawmaker and residents, the strike may have detonated an Isis truck filled with explosives that destroyed buildings in the densely populated area.

Coalition officials were previously unsure if there were any air strikes targeting the al-Jadida neighbourhood when residents said the assault had killed dozens of civilians.

Abdul Sattar al-Habbo, the chief of Mosul municipality, told Reuters that at least 240 bodies have been pulled out from under the rubble of the buildings. Local officials estimated earlier in the week that about 130 people had died.

The speaker of the Iraqi parliament, Salim al-Jabouri, said in a statement: "What's happening in the west part of Mosul is extremely serious and could not be tolerated under any circumstances."

The Mosul offensive is now in its sixth month, even as Iraqi forces managed to capture the whole of east Mosul and about half of the western part of the city.

Smoke rises over the city during clashes between Iraqi forces and Islamic State militants, in Mosul Reuters