Islamist terrorists are plotting to attack rallies held by Germany's far-right Pegida movement, according to intelligence sources.

Foreign intelligence services have intercepted communications by "known international jihadists" planning strikes against those taking part in the rallies of the group, which aims to halt what it describes as the 'Islamification' of Europe, according to AFP and Der Spiegel reports.

The intelligence was passed to German authorities, with an unnamed and high-ranking security official telling Der Spiegel "we take these leads very seriously".

There was no specific intelligence on the time or location of an attack, according to the German magazine.

Numbers have swollen at rallies held by Pegida, or Patriotic Europeans Against the Islamisation of the Occident, in recent months.

The group held its largest ever march in Dresden on Monday, in solidarity with the victims of the terrorist attacks in Paris, with 25,000 attending.

Critics of the group accuse it of being racist and, in her new year's address, German chancellor Angela Merkel warned that the group's leaders had "prejudice, coldness, even hatred in their hearts".

Starting with only a few hundred marchers in September, numbers at the Pegida's rallies have steadily grown.

Experts have warned that the Paris attacks could increase support for far-right organisations, and exacerbate tensions between locals and immigrant communities.

After republishing controversial cartoons depicting the prophet Mohammed from French satirical magazine Charlie Hebdo, the first target of the Paris attacks, German tabloid Hamburger Morgenpost was subjected to an arson attack.

Some argue that this is part of a deliberate strategy by Islamist terrorists.

"The radicals are trying to exacerbate tensions that are already there," Jonathan Laurence, author of Integrating Islam: Political and Religious Challenges in Contemporary France told USA Today. "They're trying to drive a wedge between Muslims and the West."

This week, it was revealed that German police were investigating a suspected 50-person Isis terror cell in the northern city Wolfsburg, with scores of German citizens believed to have travelled to Syria to fight for the jihadist group.

Merkel unveiled a nine-point anti-terror plan to the German parliament in the wake of the Paris attacks, pledging to target "hate preachers" and proposing new data collection legislation to help authorities track extremists.

In 2013, an al Qaeda-inspired Birmingham gang was found guilty of plotting to bomb a rally by UK far-right group the EDL, and assassinate its leader Tommy Robinson.