Two bombs exploded close to the Foreign Ministry in Baghdad and the fortified green zone where a visiting US diplomat was preparing to give a press conference.

At least five Iraqis were injured in the blasts, which took place in a car park across the road from the ministry. The force of the blast cracked windows in the upper floors of the building. They occurred despite a tightening of security across the capital after an increase in bomb attacks over the past fortnight.

Away from the explosions, John Negroponte, the visiting US Deputy Secretary of State, spoke to reporters alongside Hoshyar Zebari, Iraq’s Foreign Minister, with interest focused on a deal to keep US troops in Iraq beyond 2008.

"The progress on security is striking," Mr Negroponte, a former US ambassador in Baghdad, said. "I hope that Iraqis will come together to translate that progress into a revitalisation of the economy and delivery of critical infrastructure and services to the population."

Violence across the country is at its lowest level in four years, although attacks still occur, as evidenced by this morning’s bombings.

Against the backdrop of improved security, Baghdad and Washington are trying to hammer out a Status of Forces Agreement to outline the role of US troops in Iraq after a United Nations Security Council mandate expires at the end of 2008.

Mr Zebari said that a deal was close but it will take “bold political decisions” to overcome the final hurdles, which include the question of immunity for US soldiers from Iraqi law.

“This issue needs, I think, some bold political decisions. And we are at that stage. And that's why I suggested that soon you and your colleagues will see hectic political meetings here in Baghdad on this issue to determine the fate of the agreement,” the Foreign Minister said.

Any agreement must be approved by Iraq’s Parliament. Some officials fear opposition unless the deal satisfies Iraqi nationalists.

Mr Zebari said that the US side had submitted new “reasonable” proposals on immunity but emphasised that the Government had taken no final decision.

Mr Negroponte, who is wrapping up a four-day trip to Iraq, refused to discuss specifics of the talks, saying only that “both countries are pursuing this issue from the point of view of their own national self-interest”.

As the two men spoke, the US military reported another death of a US soldier killed in the northern city of Mosul in a gun battle with an al-Qaeda suspect.

The latest casualty raised to 4,178 the number of US troops killed in Iraq since the March 2003 invasion.

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