The soldiers forced the police who normally control the four main access points to Bouake to flee, before taking up positions and blocking all traffic into the city. "We're also ready to fight if we are attacked".
They said that the government has asked for a delay in these payments in order to ease financial pressure on the country's treasury, citing a collapse in revenues after a major collapse in the price of cocoa, Ivory Coast's main export.
The soldiers, a lot of them ex-rebel fighters who helped bring President Alassane Ouattara to power, erected improvised barricades around the national military headquarters and sealed off part of downtown Abidjan.
The decision was rejected by at least part of the group.
Annual spending is being reduced by 250 billion francs ($413 million), Ouattara said on state television Thursday in the commercial capital, Abidjan. "We definitively renounce all our financial demands", Fofana said on Thursday, and saluted the president in a sign of allegiance.
"This is our answer to yesterday's announcement", one of the rebel soldiers meanwhile told the AFP news agency on the condition of anonymity.
The government has reportedly paid the 8,400 troops behind the rebellion bonuses of 5 million CFA francs (7,500 euros/$8,200) each as part of a deal to end the prolonged mutiny.
One soldier could be seen wandering around with a rocket launcher, another carried a machinegun with a string of bullets looped around his shoulders, Rambo style. The gunfire erupted after disgruntled troops sealed off the area in the Plateau district of the Abidjan, the country's economic capital, an AFP correspondent said.
Bouake residents said shops remained closed as soldiers fired weapons in the air and patrolled the streets in cars.
Before nightfall, a delegation including the Military Chief of Staff General Sekou Toure and the heads of the Republican Guard, Special Forces and National Gendarmerie briefly entered the camp before leaving around 20 minutes later.
Mirroring the rapid spread of the January mutinies, gunfire also was heard at Ivory Coast's military headquarters as well its largest military base in Abidjan, military and diplomatic sources said. "Other soldiers are also deployed inside the city".
Ivory Coast, the world's top cocoa producer, is emerging from a decade-long crisis that ended in a brief civil war in 2011 following an election in which Ouattara emerged as victor. But the mutinies show that divisions persist, particularly in a military assembled from ex-rebel and loyalist fighters.