FRANCOIS Hollande has told France that it is now at war with the terrorists of so-called Islamic State after the latest atrocity stunned the nation.

Father Jacques Hamel, an 84-year-old priest in the quiet Normandy village of Saint-Étienne-du-Rouvray, near Rouen, was saying morning mass when two armed men stormed into the local church. He died after being forced to kneel on the floor. One of the attackers slit his throat.

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An eyewitness, a nun named as Sister Danielle, revealed the terrorists had recorded the event, raising the prospect that the video will at some point appear on social media.

The attackers took four people hostage in the church, one of whom is in a critical condition in hospital.

Reports suggested one of the terrorists, a 19-year-old, had recently been in prison and was wearing an electronic tag after trying unsuccessfully to travel to Syria to fight with IS, also known as Daesh.

French media named one of the attackers as Adel K. Police were also reported to have raided a local flat.

After around an hour in the church, the two men, one said to be in Islamic dress, attempted to leave but were shot dead by police, who by then had surrounded the building.

Sister Danielle, who described Fr Hamel as a “great priest,” told a local TV station: "They forced him to his knees. He wanted to defend himself and that's whe n the tragedy happened. They recorded themselves. They did a sort of sermon around the altar in Arabic. It's a horror."

The execution of a defenceless priest sent further shock waves through a nation, which is already reeling from the murder of 84 people in Nice on July 14, when a Tunisian national drove a lorry into crowds enjoying Bastille Day fireworks, the stabbing of a police officer and his wife in the French capital last month, as well as earlier atrocities directed at rock fans and sports crowds and the Charlie Hebdo magazine in Paris.

A statement from the IS-affiliated Amaq news agency said that the attack had been carried out by “two soldiers of the Islamic State”.

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Speaking after meeting emergency workers and the town mayor in Saint-Etienne-du-Rouvray, Mr Hollande condemned what he said was a cowardly assassination.

"We are faced with a group, Daesh, that has actually declared war, and we have to fight this war using all means possible. Of course, we have to respect the rule of law because we are a democracy," he said. Later, addressing the nation on television, he warned the threat of Islamic extremism to France had never been greater.

In Downing Street, Theresa May offered her “condolences to the French people following the sickening attack in Northern France" and that “our thoughts and prayers are with all those affected".

The Prime Minister made clear Britain would stand "shoulder to shoulder with France," declaring: "The terrorists will not prevail. They are trying to destroy our way of life. They are trying to destroy our values. We have shared values and those values will win through and the terrorists will not win."

Elsewhere, a five-judge tribunal on the use of communications data by the intelligence services heard how a terrorist attack in the UK was regarded as "highly likely" following attacks in other parts of Europe.

As more details of the attack emerged, messages of sorrow and condolence came in from around the world.

Pope Francis decried the "pain and horror of this absurd violence".

Archbishop Philip Tartaglia, President of the Bishops’ Conference of Scotland, expressed the “deep sorrow and shock of the Catholics of Glasgow and Scotland”.

In a letter to Monseigneur Dominique Lebrun, the Archbishop of Rouen, Archbishop Tartaglia said: “We pray for the repose of the soul of the priest killed and for the recovery of those injured. e pray for the people of France, Germany and other places so cruelly targeted by men of evil intent in recent weeks. May God have mercy on us all.”

Justin Welby, the Archbishop of Canterbury, said: "Evil attacks the weakest, denies truth and love, is defeated through Jesus Christ. Pray for France, for victims, for their communities."

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Chief Rabbi Mirvis offered "prayers with our Catholic friends" in a message on Twitter.

Imam Qari Asim of Leeds Makkah Mosque condemned the “depravity of these murderers,” and added: “An attack on any place of worship is an attack on our way of life and, therefore, an attack on all of us; regardless of who you are, where you come from and your faith."