Iraq ? Just as Iraqis were welcoming in the new year with hopes for peace, a suicide bomber on Tuesday reminded them of the violent unrest still racking the country with one of the deadliest attacks to hit the capital in months.

At least 35 people were killed and 37 wounded when the attacker detonated an explosive vest at a crowded Shiite Muslim funeral for an ex-military colonel in Saddam Hussein’s army, police said.

The attack appeared to be timed to coincide with the last day of a three-day funeral ritual when a big meal is served. Mourners were grieving for the victim of a suicide bombing last week, Nabil Hussein Alwan.

The bombing occurred hours after Iraqis took to the streets to celebrate New Year’s Eve. In Baghdad’s safer neighborhoods, residents gathered at parties at two hotels, dancing and setting off small fireworks.

Although 2007 overall was the deadliest year since the war began, the steep decline in violence during the latter half of the year continued in December. According to statistics released Monday by the Ministry of Health, 481 civilians died nationwide in December in war-related bombings, mortar attacks and sectarian slayings, the lowest monthly total of the year.