"We are in the midst of a campaign against terror in Gaza. It entails an exchange of blows," Netanyahu told his weekly cabinet meeting in Jerusalem, adding that the recent flare-up of violence "will not end in one strike," Xinhua reported.

He said that during last week's massive airstrikes in the Gaza Strip, the Israeli air force has "destroyed hundreds of Hamas military targets." He added that "in each round, the Israel Defense Forces exacts an additional heavy price."

He stressed that Israel is ready to continue the strikes. "I will not reveal here our operational plans, they are ready," he said.

"Our demand is clear -- a complete cease-fire. We will not suffice with less than this," he said. "Our objective is to restore the quiet to residents of the south and the area adjacent to the Gaza Strip; this goal will be achieved in full."

Last week, Israel and Hamas exchanged blows, with Israel striking hundreds of sites in Gaza, killing three people including a woman and her baby, while Gaza militants launched dozens of rockets towards southern Israel.

The fire was largely ceased on Thursday, as an unofficial truce was achieved following efforts by the United Nations and Egypt.