Police have issued a call for witnesses and published a photo of the suspect - AFP

A manhunt is underway in the southeastern French city of Lyon after more than a dozen people were injured in the explosion of a "nail bomb".

The blast was caused by a "home-made bomb" in a case containing "an explosive charge and nuts and bolts", which went off at 5.30pm local time, said the interior ministry. The explosion occurred in the centre of France's third-largest city outside a boulangerie in rue Victor Hugo.

Prosecutors have launched a terror probe into the attack.

Police on Friday night issued an appeal for witnesses, publishing a grainy CCTV photo of the “dangerous” suspect, who is wearing large dark glasses and appears to be masked.

It said he was “wearing a dark top, light shorts and could be moving around by bike”.

According to French reports, the suspect in his early to mid-30s placed the case on the ground and made his escape on a mountain bike.

Some 13 people were injured in the blast, none seriously Credit: PHILIPPE DESMAZES/AFP

An eight-year old girl was reportedly among those hit by the blast but was not seriously hurt.

AFP cited police sources as saying that 13 people were injured and that 11 had been evacuated to hospital. None are in a serious condition, according to the mayor of the second arrondissement of Lyon, Denis Broliquier.

Police were able to track the suspects movements across the city on CCTV. “We have his itinerary there and back,” said Mr Broliquier. They lost him, however once he crossed the Rhone river to the East of the city.

The mayor said that while the bomb appeared to be the work of an “expert”, the "explosive charge was relatively weak”. Most of the injuries were caused by broken glass from a shop window.

French president Emmanuel Macron confirmed there had been an "attack in Lyon" but no deaths.

"My thoughts obviously go to the wounded and their families," he said during an interview.

In a sign of the seriousness of the attack, Edouard Philippe, the French prime minister, cancelled his appearance at the final rally of the Macron camp in Paris ahead of Sunday's European elections in France.

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Christophe Castaner, the interior minister, travelled to the scene. In a tweet, he said he had ordered state authorities to "reinforce security at sites welcoming the public and sports, cultural and religions events".

The women's World Cup soccer tournament is scheduled to start in France on June 7. Lyon will host the semifinals, and then the final on July 7.

Police and soldiers patrolling as part of the anti-terror Vigipirate programme have closed off the area with a security cordon.

A police officer carrying evidence at the site of a suspected bomb attack in central Lyon Credit: Emmanuel Foudrot/Reuters

Local state authorities are asking inhabitants to avoid the district, situated near place Bellecour, Lyon's biggest square.

"There was an explosion and I thought it was a car crash," said Eva, a 17-year-old student who was about 15 metres from the site of the blast.

"There were bits of electric wire near me, and batteries and bits of cardboard and plastic. The windows were blown out," he said.

Alexis Saillan, receptionist at a hotel near the explosion said he heard a "deafening blast".

"I saw people running in panic and heard some cries. Police told me it was a package bomb. They told us to stay indoors and to close the windows," he told BFMTV.

The suspect is still at large Credit: PHILIPPE DESMAZES/AFP

David Kimelfeld, head of the Lyon area, said: "This is the first time that Lyon has been through such an episode."

He added: "We are worried when this type of attack happens, but we need to remain very cautious over the circumstances and not panic the population."

France has been on high alert since the start of a wave of jihadist attacks began in 2015, leaving more than 250 people dead, with the Islamic State (IS) group urging followers to target soldiers and police in France.

Despite the collapse of IS's self-proclaimed "caliphate" in Iraq and Syria last month, the threat of further attacks inspired by the group remains high.

At the end of March, two men, one which psychiatric problems, were indicted in Paris on suspicion of planning an attack on a school or a police officer.