A bomb has exploded in a fast-food restaurant in the downtown area of Chile's capital Santiago, wounding at least 10 people.

Interior Minister Mahmud Aleuy said security cameras showed two suspects putting the device in a metal container outside the restaurant, which is situated next to the Escuela Militar metro station, and then escaping in a car.

No group has claimed responsibility for the attack.

The incident occurred in the week in which Chile commemorates the 41st anniversary of the 1973 coup d'état which overthrew former president Salvador Allende and saw the rise of army chief Augusto Pinochet.

The anniversary still prompts protests which often turn violent.

Chile's President Michelle Bachelet said: "This is a cowardly act because it has as its objective to hurt people, create fear and even kill innocent people.

"We're going to use all the weight of the law, including the anti-terrorist law, because those responsible for these acts have to pay."

Bachelet appealed to residents to remain calm: "This is horrible, tremendously reprehensible, but Chile is and remains a safe country."

Alvaro Elizalde, the government's chief spokesman said: "This is an act that has all the hallmarks of a terrorist deed. There is no doubt. And it has been carried out with the intention of hurting innocent people."