The homemade time bomb that went off just before midnight Monday at the Traders Hotel was hidden in the bathroom in an American family's room on the ninth floor. There was no indication they had been targeted.
On Tuesday afternoon, authorities safely detonated a bomb found at Western Park restaurant in Yangon.
Saw Myint Lwin was suspected of playing a role in that foiled plot, the Mon state police statement said, without elaborating.
The government speculated the recent bombings were being organized by individuals or groups who want to smear the country's image as it prepares to take leadership of the Association of Southeast Asian Nations regional grouping in 2014.
It is also hosting the Southeast Asian Games, a showcase sporting event, later this year, noted Ko Ko Hlaing, a political adviser to the president.
U.S. State Department spokeswoman Jen Psaki said Tuesday in Washington she could not comment on any motive behind the bombings. She said the embassy released a security message to alert U.S. citizens who reside in or are traveling to the country to the recent bombings.
"While there is no indication at this time that any of these IEDs were specifically directed toward U.S. citizens, the embassy asks that all U.S. citizens exercise an appropriate level of caution," she said.
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Associated Press writers Aye Aye Win, Esther Htusan and Todd Pitman contributed to this report.