Palestinian rams car into Jerusalem crowd, killing baby

It was the second such deadly incident in three months, prompting Israeli Prime Minister Benjamin Netanyahu to immediately order an increase in police presence across the city.

The driver, identified as Abed Abdelrahman Shaludeh, a Palestinian from Silwan in east Jerusalem, died from his injuries early on Thursday, the Shaarei Tzedek hospital said.

The 21-year-old had been shot and wounded as he tried to flee the scene, police spokeswoman Luba Samri said.

The United States condemned what it called a "terrorist" attack.

"We express our deepest condolences to the family of the baby, reportedly an American citizen, who was killed in this despicable attack," State Department spokeswoman Jen Psaki said in a statement.

"We urge all sides to maintain calm and avoid escalating tensions in the wake of this incident."

During the early evening attack, the car was driven at top speed into pedestrians near the Ammunition Hill tram stop on the seamline between west and occupied east Jerusalem.

Seven people were hurt, including a three-month-old girl, Haya Zissel Braun, who later died, said Hadassah hospital. She was buried on Wednesday evening.

Samri described the incident as a "hit and run terror attack" -- the second in the area in just under three months.

During the most recent incident in August, a Palestinian man rammed a bus with an excavator, killing one Israeli and injuring five. Police shot the driver dead.

'Missed us by centimetres'

Witnesses of Wednesday's attack said the car ploughed into the crowd at great speed.

"We saw a car coming from the north at full speed," said Eli Dayan. "We realised something was going on. He missed us by a few centimetres."

Footage of the incident posted on YouTube showed a car driving at full speed off the main road and down the pavement where people were standing as two trams passed each other.

Another clip shot on a cellphone showed the driver lying on the ground in a T-shirt and ripped jeans as a man pointed a gun at him.

Aside from the baby, medics treated six other people -- one in serious condition, one moderately hurt and four with light injuries, medics said, revising down an earlier toll of eight.

Driver from Silwan

Samri said Abed Abdelrahman Shaludeh was from Silwan, a densely populated Arab neighbourhood on a steep hillside just south of the Old City.

Family members said he had been recently released from an Israeli prison where he served 14 months for disturbing the peace.

Silwan has been wracked by unrest in recent years after Jewish hardliners took up residence in the area, triggering frequent clashes between stone-throwing residents and police.

It hit the headlines in recent weeks after settlers acquired another 35 apartments there, triggering a furious reaction from both the Palestinians and the international community.

In the neighbourhood, scores of police could be seen trying to enter the Shaludeh family home, as dozens of masked Palestinians hurled stones at them, police and residents said.

Four family members who went to visit Shaludeh in Shaarei Tzedek hospital were arrested, a relative told AFP.

Clashes also erupted in Issawiya, Al-Tur and Shuafat refugee camp, all of them flashpoint districts in Arab east Jerusalem, which was occupied and annexed by Israel during the 1967 Six-Day War in a move never recognised by the international community.

Hamas family ties

Family members confirmed Shaludeh was a nephew of senior Hamas bomb-maker Muhi al-Din Sharif who was killed in the West Bank city of Ramallah in mysterious circumstances in 1998.

Israeli officials also identified him as a member of the radical Islamist Hamas movement.

Netanyahu lashed out at Palestinian president Mahmud Abbas, whose Fatah movement signed a reconciliation agreement with Hamas this year, leading to the establishment of a jointly-agreed government of national consensus.

"This is how Abu Mazen's partners in government act, the same Abu Mazen who -- only a few days ago -- incited toward a terrorist attack in Jerusalem," Netanyahu said, using the Palestinian leader's nickname.