The victims were taken to five different hospitals in Baghdad.

Witnesses said wounded people were crying for help and people were trying to flee the scene.
 
Police pickups and ambulances arrived at the scene to pick the casualties.

Dozens of shopfronts and cars were damaged in the explosion, witnesses said.

On Monday, two bomb blasts in central and eastern Baghdad killed 19 people, despite an increase in security for the visit of Mahmoud Ahmadinejad, Iranian president.

Violence in the capital has dropped significantly in recent months and the US military announced on Thursday that it was to withdraw about 2,000 troops from Baghdad.

Lieutenant-Colonel Steve Stover, US military spokesman, said that the 2nd Brigade Combat Team, 82nd Airborne Division, which has been based in northeast Baghdad, would not be replaced after it completed its 15-month tour of duty.

He told the Reuters news agency that there were about 34,500 troops operating in the Iraqi capital out of the total force of more than 155,000 across the country.