The explosion which killed three people at a McDonald's restaurant in the Indonesian city of Makassar was caused by a bomb, according to national police chief Da'i Bachtiar.

He told reporters a bomb was also the cause of a second explosion Thursday evening in the city in South Sulawesi province.

In terms of loss of life it was the worst blast since a terrorist attack in Bali island killed more than 190 people on October 12. That attack was widely blamed on the Jemaah Islamiyah regional terror group.

Bachtiar said he has sent the national detective chief Erwin Mappaseng to Makassar to head an investigation.

"Despite what we have uncovered about recent terrorist actions such an incident still occurs," he said. He did not say whether he believes the Makassar bombs are connected to the Bali attack.

"There are still people and perhaps groups who are trying to cause disturbances and perhaps create fear among the public with bombs," Bachtiar said.

The police chief said 11 people were injured in the blast in a kitchen at the McDonald's in the city's Ratu Indah shopping mall.

Later Thursday evening an explosion damaged at least four cars at a Toyota vehicle showroom in the same city. No injuries were reported there.

A police source said the showroom was owned by top welfare minister Yusuf Kalla, a native of Makassar. Kalla negotiated an agreement last December to end Muslim-Christian battles in Central Sulawesi, and also a deal in February to end sectarian fighting in the Maluku islands.

The explosions occurred on the first evening of the Eid al-Fitr festival marking the end of the Muslim fasting month of Ramadan.