The attack took place Sunday in the city's Bole district, whic
h is home to a large Somali population. There was no immediate claim of responsibility for the bombing, but Ethiopia says it has thwarted plots of attacks in the past two years and blames rebel groups based in the south and southeast, as well as Somalia's al-Shabab insurgents.
Ethiopian troops have been fighting al-Qaida-linked al-Shabab militants in Somalia since 2011, alongside African Union forces from Uganda, Burundi and Kenya.
Last month, al-Shabab led an attack on a shopping mall in Kenya in which at least 67 people were killed. The al-Qaida-linked group said the attack was retaliation for Kenya's military intervention in Somalia.