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Prime Minister David Cameron said there were "strong indications that it is a terrorist incident" and the UK would "never buckle" in the face of such attacks.
Footage has emerged showing a man wielding a bloodied meat cleaver and making political statements.
There are unconfirmed reports that the dead man was a soldier.
Both French President Francois Hollande and MP Nick Raynsford said the dead man had been a soldier at Woolwich barracks.
