Iraqi Foreign Minister Hoshyar Zebari said an agreement was "very close" and that there were "new ideas and new language" to clinch a mutually acceptable security deal. "This needs some bold political decisions now," he said.

An Iraqi military officer said at least one soldier was wounded in the blasts which went off in quick succession at a time of heavy traffic.

The first blast targeted a parked Iraqi armored vehicle and a car bomb went off minutes later at a nearby parking lot opposite the foreign ministry, on the edge of the Green Zone where Iraq's government and the U.S. embassy are located.

Minutes after the attacks, Negroponte began his scheduled press conference with Zebari.

Negroponte was wrapping up a four-day visit to Baghdad for talks on the controversial deal on the presence of American troops in the country after a U.N. Security Council mandate for multinational forces expires on Dec. 31.

Even as they spoke, the U.S. military reported another death of an American soldier killed in the northern city of Mosul yesterday in a battle with an Al-Qaeda suspect.

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

Outside the Green Zone, Iraqi soldiers fired in the air to keep motorists and pedestrians out of the bombed area while two fire fighting trucks put out the flames.