Farooq Haitham, a 33-year-old owner of a watch repair shop near the site of the explosions, told Associated Press that there had been many bombings in the area.

"This area has witnessed many explosions, but what can we do? We want to live, our need for money forces us to come again and work," he said.

In central Baghdad, armed men dressed in police commando uniforms abducted eight people from a computer store, police said.

Two people were slightly injured when a rocket was fired into the fortified Green Zone in Baghdad and landed in the grounds of the US embassy.

Mortars and rockets are frequently fired into the area but rarely cause any casualties.

Elsewhere, US air raids reportedly killed 14 people and destroyed a "foreign fighter safe house" south of Baquba that also led to the capture of two other suspects, the military said.

The military said the raid was against an unidentified foreign fighter believed responsible for multiple attacks on Iraqi and multi-national forces in the area.