Hamas said on Friday it agreed to release an American-Israeli dual national, believed to be the last living American hostage held in Gaza, after receiving a proposal from mediators to continue negotiations on the second phase of a ceasefire deal.

The United States has put forward a new proposal that would secure the release of a handful of living hostages held by Hamas in exchange for a month-long extension of the Israel-Hamas ceasefire, a source familiar with the negotiations said.

Hamas said it was ready to release a living American hostage and four bodies, though it was unclear if the US and Israeli governments sought such a move and whether they would accept it unconditionally.