The German Interior Minister, Horst Seehofer, has said a shooting in the east German city of Halle is believed to have been an anti-Semetic attack.

Two people were killed, and police said they had detained one person.

The Bild newspaper said the shooting took place in front of a synagogue, and that a hand grenade was also thrown into a Jewish cemetery.

Mr Seehofer said federal prosecutors who have taken on the investigation thought there were signs that it could be a right-wing extremist attack.

"Based on current information, we have to assume that it was at least an anti-Semitic attack. According to the federal prosecutors office, there are enough indications that it was possibly a right-wing extremist motive. They have taken over the investigations".

An eyewitness told n-tv television that a perpetrator had also fired shots into a kebab shop in Halle.

The violence occurred on Yom Kippur, the holiest day of the year in Judaism when Jews fast for more than 24 hours, seeking atonement.

Police in Halle have lifted a lockdown on city streets, after determining the security situation was no longer "acute".

"Our forces have detained one person," local police said on Twitter. "Please nonetheless remain vigilant."

Earlier, police tweeted: "According to initial findings, two people were killed in Halle. There were several shots."

Gunshots were also heard in Landsberg, a Halle suburb, Focus Online reported.

A spokesperson for German Chancellor Angela Merkel said she condemned the attack, and has "deep sympathy" for the victims' loved ones.

Initial police statements did not confirm the media reports associating the gunfire and grenade attack with Jewish targets.