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Hundreds of security personnel are searching for Chérif Chekatt, 29, on both sides of the Franco-German border.
The suspect had a string of criminal convictions and had become a radical Islamist while in prison.
Police say he is highly dangerous and should not be approached.
French officials announced on Thursday that a third person had died in the aftermath of the Strasbourg attack. Five people were seriously wounded, they said, including a man described as brain dead.