STOCKHOLM -- A man armed with an axe attacked and injured eight people in a southern Swedish town Wednesday before being shot and arrested, police said.

Prime Minister Stefan Lofven said a possible terrorist motive was being investigated.

"In the light of what has emerged so far in the police investigation, prosecutors have initiated a preliminary investigation into terrorist crimes," he said but didn't elaborate.

Shortly after his statement, investigators at a police press conference said they had started a preliminary investigation into attempted murder, with details "that make us investigate any terrorist motives."

"But at the moment I cannot go into details," regional police chief Malena Grann said.

Police said the man in his 20s attacked people in the small town of Vetlanda, about 190 kilometres (118 miles) southeast of Goteborg, Sweden's second largest city. His motive was not immediately known.

The man was shot by police, who said the condition of those attacked and of the perpetrator was not immediately known. Officials did not provide the identity of the suspect, who was taken to hospital.

Local police chief Jonas Lindell said "it seems that the injuries are not life-threatening" but could not give further details.

The events took place in downtown Vetlanda with police saying they got calls just after 1400 GMT about a man assaulting people with an axe. Police also said that there are five crime scenes in this town of roughly 13,000.

Lofven condemned "this terrible act," and added that Sweden's domestic security agency SAPO was also working on the case.

"They continuously assess whether there are reasons to take security-enhancing measures and are prepared to do so if necessary," he said in a statement.