The United States and Turkey indicated on Saturday they might impose no-fly zones in Syria as battles between rebels and President Bashar al-Assad's forces shook Aleppo and fighting erupted in the heart of Damascus.

US Secretary of State Hillary Clinton said after meeting her Turkish counterpart Ahmet Davutoglu in Istanbul that Washington and Ankara should develop detailed operational planning on ways to assist the rebels fighting to topple Assad.

'Our intelligence services, our military have very important responsibilities and roles to play so we are going to be setting up a working group to do exactly that,' she said.

Asked about options such as imposing a no-fly zone over rebel-held territory, Clinton said these were possibilities she and Davutoglu had agreed 'need greater in-depth analysis', while indicating that no decisions were necessarily imminent.

'It is one thing to talk about all kinds of potential actions, but you cannot make reasoned decisions without doing intense analysis and operational planning,' she said.

Nevertheless, her remarks were the closest Washington has come to suggesting direct military intervention in Syria.

No-fly zones imposed by Nato and Arab allies helped Libyan rebels overthrow Muammar Gaddafi last year. Until recently, the West had shunned the idea of repeating any Libya-style action.

Saudi Arabia and Qatar are believed to be arming Syrian rebels, while the US and Britain have pledged to step up non-lethal assistance to Assad's opponents.

Davutoglu said it was time outside powers took decisive steps to resolve the humanitarian crisis in cities such as Aleppo, where Assad's forces have fought rebels for three weeks.

Jets, tanks in action

In the latest battles, tanks and troops pummelled rebels near the shattered district of Salaheddine, a former opposition stronghold that commands the main southern approach to Aleppo.

Tank fire crashed into the adjacent Saif al-Dawla neighbourhood as military jets circled over an abandoned police station held by rebels, firing missiles every few minutes.

Insurgents said they had been forced to retreat in the latest twist in relentless, see-saw battles for Salaheddine, part of a swathe of Aleppo seized by rebels last month.

Some rebels, outgunned and low on ammunition in Aleppo, have pleaded for outside military help, arguing that more weapons and a no-fly zone over areas they control near the Turkish border would give them a secure base against Assad's forces.

'The reason we retreated from Salaheddine this week is a lack of weapons,' complained Abu Thadet, a rebel commander in Aleppo who said his fighters would regroup and fight back. 'We can handle the bombing. It's the snipers that make it hard.'

Ten of the 30 fighters in his brigade have been wounded, mostly by snipers lurking even in areas rebels claim to control. His men have broken holes in walls of buildings to try to create safe passages for them to move around in Salaheddine.

In Damascus, where Assad's forces have regained control of districts overrun by rebels last month, a resident reported an explosion near the Central Bank, followed by gunfire.

'The explosion was huge. There has been fighting for the past half-hour along Pakistan Street. I am very close. Can you hear that?' she told Reuters, a bang audible over the telephone.

Syrian state TV said authorities were hunting 'terrorists' who had set off a bomb in Merjeh, an area near the central bank, and who were 'shooting at random to spark panic among citizens'.

Despite their superior firepower, Assad's forces have been stretched by months of warfare against increasingly skilled and organised fighters who have taken them on in every city and in many parts of the countryside at one time or another.-Reuters