No Aussies affected in Mosul attack: PM

Islamic State militants used a chemical in an attack on Iraqi forces in Mosul over the weekend, and the agent has been sent for testing to try to identify it, the USA general commanding coalition ground forces in Iraq said on Wednesday.

IS has periodically carried out attacks using chemical weapons, but both the toll and the impact on military operations has been minimal and the jihadists' bombs and bullets are far deadlier.

Government forces are trying to capture the Grand Al-Nuri Mosque in the Old City, from where Daesh leader Abu Bakr Al-Baghdadi declared a "caliphate" spanning parts of Iraq and Syria almost three years ago. The first attack occurred on Saturday in the Abar neighborhood of western Mosul.

Progress has slowed considerably in Mosul because much of the fighting is now door-to-door.

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"Australian medics at a secure base outside Mosul provided first aid to the Iraqi soldiers affected by the gas attack", a spokesman for Australian Defense Minister Marise Payne told The Sydney Morning Herald.

"They are being shot at, there are artillery barrages, families are running out of supplies, medicines are scarce and water is cut-off", she added.

"It is a deteriorating situation, we fear for the lives of the 400,000 people in the old city", said Grande.

Government forces, including army, police and elite counter terrorism units have taken back most of it, including the half that lies east of the Tigris river. But Iraq's United Nations ambassador, Mohamed Ali Alhakim, said later there was no evidence for that. What little food remains is too expensive for most residents to afford, or kept for Daesh fighters.