STOCKHOLM (AFP) - Swedish police on Thursday (Nov 19) arrested a man suspected of plotting a "terrorist attack" after a two-day manhunt, as the country steps up security after last week's carnage in Paris.

Iraqi Mutar Muthanna Majid was apprehended during an afternoon raid on a centre for asylum seekers in the northeastern city of Boliden without incident, according to security services.

Sweden has been on high alert since 129 people died in a wave of attacks in Paris on Friday that were claimed by the Islamic State in Iraq and Syria (ISIS).

Swedish Prime Minister Stefan Lofven congratulated the security services for the "speed with which the suspect was located and arrested".

The authorities had issued an arrest warrant for 25-year-old Majid, who local media said was suspected to have fought in Syria, for preparing a "terrorist" attack.

"The arrest took place in a calm manner" and investigators are planning to interrogate the suspect, Sweden's intelligence agency, Sapo, said in a statement.

While no link with the Paris killers was determined, Sapo has said the bloodshed in the French capital demonstrated how ISIS has expanded its reach in Europe.

Sweden kept its national terror threat status on "high" after the arrest, the second-highest level on a five-point scale, after raising it Wednesday following a review by the National Centre for Terrorist Threat Assessment.

On Thursday, Mr Lofven said Sweden had been naive about about the risk of an attack on its soil and plans to beef up security measures, including surveillance of encrypted communications.

Sweden has not seen an Islamist attack since 2010, when a man blew himself up on a shopping street in Stockholm, injuring two people.