The UK’s threat level has been lowered from critical to severe after two people were arrested in connection with the terror attack on Parsons Green.
Home Secretary Amber Rudd said police had made “good progress” in the investigation as she announced the country had been removed from the highest terror alert.
Meanwhile, CCTV images have emerged appearing to show a person walking with a Lidl bag on the morning of Friday’s rush hour Tube attack.
The footage, acquired by ITV News, is reported to have been filmed near a house in Sunbury-on-Thames, Surrey, which is at the centre of one of two police raids.
Images posted on social media following the Parsons Green attack appeared to show wires protruding from a flaming bucket inside a plastic Lidl carrier bag on the floor of a carriage.
An 18-year-old man, understood to be the suspected bomber, and a 21-year-old man remain in custody after being arrested by police on Saturday.
Assistant Commissioner Mark Rowley, the country’s top counter-terrorism officer, said developments in the operation had provided “greater clarity “ on the attack.
He said: “We are getting a greater understanding of the preparation of the device.
“There is still much more to do but this greater clarity and this progress has led JTAC - the independent body that assesses threat - to come to the judgment that an attack is no longer imminent.”
The 18-year-old man was detained on Saturday morning in the departure area of Dover ferry port, which is the busiest ferry hub in Europe and a gateway to the French coast.
Police are continuing to search a house in Sunbury-on-Thames - home to Penelope and Ronald Jones, aged 71 and 88 respectively, who previously received MBEs for services to children and families.
Mr and Mrs Jones, who have been foster parents for almost 40 years, had taken in up to 300 children including eight refugees.
A local politician said he understood an 18-year-old who had lived with the couple to be an Iraqi orphan who had moved to Britain aged 15 after his parents died.
Jim Adaway, 37, a family friend, said Mr and Mrs Jones recently returned to foster caring to help resettle youngsters from overseas, but had struggled with one of the children in their care.
An address in Stanwell, Surrey - just metres from the runway at Heathrow Terminal 5 - is also being searched in connection with the arrest of the 21-year-old man in Hounslow late on Saturday evening.
Local residents said the man living at the property in Lowlands Drive, Stanwell, which was raided by police on Sunday, is a light-skinned man of Arabic appearance.
According to a couple, who asked not to be named, he habitually stayed up late at night and was often visited by two male companions, who appeared to be in their late teens.
The husband said: “He seemed a really, really nice chap, we have sat there and had a drink with him, but he didn’t drink alcohol.
“He was from North Africa, I think, perhaps Morocco or Algeria, but he had family from Scotland. I think he moved in about 14 months ago, he was very quiet.”