Islamic State-linked news agency Amaq, which posted the video online, claims the footage shows "interviews with civilians".

It was purportedly filmed as Iraqi and Kurdish forces began a military operation to recapture the city from IS.

In the footage, a man says: "It is safe and life is normal. Satellite channels are lying. All their reports are lies."

Another adds: "The situation in Mosul is better than normal. 

"It is normal and the movement is natural. Business is going on as usual. 

"People are doing business. What they say in their satellite channels - they say what they want".

As well as "interviews" with people in the city, the footage shows bread being made at a bakery and shoppers at a vegetable market.

One man says: "The situation is good and people are outside. We went to the market."

On the first day of their advance to Mosul the Peshmerga took 80 square miles from Islamic State, according to the president of Iraq's Kurdish region.

The Pentagon said Iraqi forces were "ahead of schedule", but the commander of the US-led coalition warned that the operation "will likely continue for weeks, possibly longer".

Humanitarian impact

Some 2,000 Iraqi special forces are being supported by four brigades of the regular Iraqi Army, 15,000 Sunni militia, 15,000 Kurdish Peshmerga and a few thousand Shia militia.

Backed by air and ground support from a US-led coalition, they are taking the fight to an estimated 3,000 IS fighters in the country's second largest city.

But the forces' advance was slowed by suicide bombers, roadside IEDs and oil fires.

Meanwhile, the UN humanitarian co-ordinator for Iraq has warned the operation may overwhelm emergency services as around 700,000 civilians could need shelter. 

Lise Grande said: "Our capacity to support 700,000 people in the short-term - we couldn't do it.

"And certainly if we had to mount a response over the intermediate-term, if they couldn't go back to Mosul quickly, if there was too much damage in the city, then it would test us to breaking point."

Mosul is the last city in Iraq held by IS.

It was overrun in 2014 in what was described as a "total collapse" of government security forces, causing thousands of families to flee to Iraq's autonomous Kurdish region in the north.

During a visit to the city, IS leader Abu Bakr al Baghdadi declared an Islamic caliphate which at one point covered nearly a third of Iraq and Syria.

Using Mosul as a base, the jihadi group swept further south through Iraq's towns and cities.