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At least 20 civilians were killed and 22 others were wounded in a suicide bombing targeting a cafe and a gathering of youths near Ahli Hospital in the Karrada district of Baghdad a few minutes past midnight on Tuesday.

It was later reported Islamic State claimed responsibility for the attack in a statement circulated online by the Aamaq news agency, which is run by the jihadist group.

The casualty toll is likely to climb.

"A suicide bomber driving a rigged car was behing the Karrada blast," an Iraqi official told °®Âþµº, saying the material damage is also extensive.

A source in Baghdad police said the bombing took place in a parking near a cafe popular with young people in Karrada.

Dozens were killed, the source confirmed, saying the explosion also damaged several vehicles and nearby shops.

Iraqi security forced cordoned off the blast site as military vehicles and ambulances rushed to the scene.

There have been some tough security measures, including road blocks, implemented in the area since a deadly blast killed more than 300 people in the district in July.

That attack was also claimed by IS, which has stepped up its terrorist operations as it goes on the defensive and loses territory to advancing government forces backed by a US-led coalition.