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Afghan forces were conducting clearing operations in Kunduz early Tuesday, warning that Taliban militants were hiding in civilian homes after an hours-long assault on the city repelled with the help of NATO air support.

Helicopters hovered over the strategic provincial capital and special forces were stationed in the main square, but with fighting still in the outskirts residents remained fearful and most shops and businesses were shuttered, an AFP correspondent there said.

The assault launched early Monday came just over a year after militants briefly seized the provincial capital, and as President Ashraf Ghani flew to Brussels to meet world leaders for a crucial foreign aid conference.

"Security forces have intensified their clearing operation since last night," interior ministry spokesman Sediq Sediqqi told a press conference in Kabul, adding that fighting was ongoing in the city's outskirts.

He said at least 30 Taliban fighters had been killed, contradicting an earlier police source who put the figure at "hundreds".

A defence ministry spokesman said three Afghan soldiers had been killed and seven wounded in the fighting, while hospital officials in the city said one civilian had been killed and around 40 wounded.

Kunduz provincial governor Assadullah Omarkhil said the operation was still ongoing.

"It is a bit slow because the Taliban are using people's houses to hide," he said, asking residents to stay in their homes.

NATO forces in Afghanistan said the Afghan government "controls Kunduz", and that there had been one "US air-to-ground engagement" by helicopter defending Afghan forces on the outskirts of the city.

But the Taliban insisted that "heavy attacks" were still underway, with a spokesman saying on Twitter that the militants were advancing. The insurgents are known to exaggerate their claims.

On Monday residents had reported being trapped in their homes by intense fighting as the sound of explosions echoed across the city, with provincial officials voicing fears it could fall.

NATO spokesman Brigadier General Charles Cleveland said the strength of the attack was still being assessed.  

"We did see fighting but we did not see the scale of attack that was initially being reported," he said, comparing it to "exaggerated" attacks earlier this year on Lashkar Gah in Helmand, and Tarin Kot in Uruzgan.

Afghan troops had responded "effectively", he said.

Pity for MSF victims

Ghani will meet world leaders in Brussels on Tuesday and Wednesday in a bid to secure financial aid from the international community up to 2020.

The meeting, 15 years after the US invasion of 2001, will try to drum up support despite donor fatigue compounded by conflicts in Syria and Iraq plus the worst migration crisis since World War II.

"The enemy attacked Kunduz to catch the world's attention in Brussels (and show) they are still alive," defence ministry spokesman Dawlat Waziri said Tuesday.

After seizing Kunduz on September 28, 2015, the Taliban held the city for two days then withdrew from the outskirts on October 15. More than 280 people were killed and hundreds wounded.

A US airstrike during the fighting hit a hospital operated by Medecins Sans Frontieres on October 3, killing 42 people.

The organisation, which has not since relaunched its operations in Kunduz, had planned to mark the anniversary Monday by sending its country representative Guilhem Molinie and international president Meinie Nicolai to the city.

But the fresh Taliban assault forced them to hastily cancel and evacuate non-medical staff who had been sent ahead to prepare.

It was "a pity for the victims," Molinie said.