The attack happened at about 10am local time in a crowded market in the city's al-Jazayir neighbourhood, security sources said on Monday.
One of the dead was a policeman while the rest were civilians. Several people were also wounded.
Meanwhile, the US military said on Monday that two of its soldiers had been killed in separate parts of the country.
A US marine died on Monday during combat operations in Iraq's restive al-Anbar province. On Sunday, a roadside bomb killed a US soldier in Baghdad during a combat patrol.
A roadside bomb struck a British armoured vehicle in al-Amara, 290km southeast of Baghdad. A British military spokeswoman said nobody was wounded.
Iraqi police said two mortar rounds landed outside the British/Australian base in Samawa, 370km southeast of Baghdad. No injuries were reported.