A gun battle has erupted between Malian soldiers and suspected separatist rebels in Kidal in the north, sparking fears that the violence could escalate.

Gunmen attacked soldiers guarding a bank in the town, who returned fire.

Residents and an unnamed official said the gunmen were rebels from a Tuareg group who days ago announced they were pulling out of a peace deal.

June's ceasefire followed more than a year of fighting that prompted an intervention by French troops.

French troops remain stationed in northern Mali and the Malian army has controversially returned to Kidal.

The provincial capital had been in the hands of rebels from the National Movement for the Liberation of Azawad (MNLA) for months.

Spate of violence

He said he did not know who the gunmen were, but an unnamed source from his office and some residents said it was the MNLA, who the unnamed source explained "never wanted the army around".The regional governor, Adama Kamissoko told the AFP news agency from Kidal that "a lot of shots" were being fired in the city, adding: "Armed men are shooting and the Malian soldiers have retaliated."

There was no information about casualties in the clash. Sunday's violence is the latest in a spate of violent incidents.

On Friday, two Malian soldiers were wounded in Kidal when a grenade was thrown at them. On Saturday, at least two people were killed in Timbuktu, also in the north, when suicide bombers blew up a car near a military camp.

On Sunday, a local civic leader told Associated Press he had heard shots fired at the army camp near Kidal but there were no further details.

June's peace deal had permitted elections to take place and the new President, Ibrahim Boubacar Keita, was sworn in earlier this month.

He has pledged to reunite Mali following the Tuareg uprising, which prompted a takeover of the north by Islamist fighters and threw the country into turmoil until France intervened in its former colony.

But Tuareg rebels said on Thursday they were pulling out of the peace deal, accusing the Malian government of failing to live up to its promises including prisoner releases.