A coalition of Kurdish and Syrian rebel groups supported by US coalition air strikes have seized the Islamic State (IS) group stronghold of Manbij, two months after launching an operation to capture the strategic city in northern Syria, a monitor said.

"The Syrian Democratic Forces (SDF) took control of Manbij on Saturday and are combing the city in search of the last remaining jihadists," the Syrian Observatory for Human Rights said.

The SDF first encircled the town in early June and surged into it later that month. Its assault was slowed by a fierce IS fightback that saw the militants launch a series of suicide attacks and car bombs. On Friday, IS still controlled two pockets inside the city but was surrounded by SDF forces and unable to bring in reinforcements or ammunition.

MEE contributor Wladimir van Wilgenburg in northern Syria, however, said that the announcement was premature and that sources on the ground were indicating there is still heavy fighting taking place for the remaining five percent or so of the city, but that the battle for Manbij could soon be over.

"The battles are continuing near the centre of the town. We are in control of 90 percent of Manbij," a spokesman for the Manbij Military Council, Sherfan Darwish, told AFP.

An SDF commander, Adnan Abu-Amjad, said his forces were "advancing cautiously" into the city and had taken most of the town. The main obstacle was that IS was using civilians as human shields.

He said the "small groups" of militants that remained had been surrounded by SDF soldiers.

Abu-Amjad said that between 10,000 and 15,000 civilians were left in areas under IS control, and his forces were working to avoid any harm to civilians.

SDF spox says #Manbij is not over yet, AFP report is not true #syria pic.twitter.com/owYX1qCX2R — Wladimir (@vvanwilgenburg) August 6, 2016

US President Barack Obama on Thursday touted progress the US and its allies have made in the military campaign against IS, while adding that it still posed a threat to the West.

At a news briefing he addressed a wide range of security topics, including the fight against Russia's involvement in Syria and $400m shipped to Iran after the nuclear deal.

Manbij has been the scene of intense fighting between the SDF and IS for the last two months.

The US coalition has been supporting the SDF with air strikes and has been targeting key IS strongholds in Manbij throughout the campaign.