At least 10 people have been killed in riots in central Myanmar, a local MP said Thursday, prompting US concern at the worst communal unrest since Buddhist-Muslim clashes in western Rakhine state last year.

The United States said it was "deeply concerned" by the unrest, which according to police erupted on Wednesday after an argument in a Muslim-owned gold shop intensified and caused about 200 people to fight in the streets.

Win Htein, a member of the opposition National League for Democracy party, said he had seen bodies at the scene of fresh clashes Thursday.

"More than 10 people were killed," he told AFP from the town.

The unrest comes amid heightened tensions between Muslims and Buddhists in Myanmar.

Communal conflict in Rakhine has left at least 180 people dead and more than 110,000 displaced since June 2012, overshadowing international optimism about the country's widely praised political reforms since the end of military rule two years ago.

In a brief statement, the US embassy said it was closely monitoring the new violence and extended "deepest condolences to the families of those who lost their lives and property in the violence."

A curfew was put in place overnight but witnesses said fighting erupted again on Thursday morning. A local resident said he had seen "many dead bodies."

"The situation is getting worse. The police cannot control the people," he told AFP.

The local hospital said it had attended to five dead and 25 wounded.

"Two died from burn injuries and the other three were killed because of wounds sustained from knives and sticks," a hospital official said, asking not to be named.

The clash raises concern that religious unrest could spread in Myanmar, a Buddhist-dominated country where about 5 percent of the 60 million population are Muslim.

AFP - Reuters