RIGA (AFP) -- The Latvian economy is set to show growth of 11.0 percent this year, and for growth of 9.0 percent in 2007, the central bank said.

Bank of Latvia spokesman Martins Gravitis said that the service sector had fuelled growth of gross domestic proeuct in 2006, and that if current trends held until the end of the year the final figure would be about 11.0 percent.

"Next year the contribution of goods in economic growth might increase and the contribution of services decrease. The total GDP growth for next year is expected at 9.0 percent," Gravitis was quoted as saying by the Baltic News Service (BNS) press agency.

Annual inflation was likely to hit 6.4-6.5 percent this year and fall only slightly in 2007 to 6.2 percent, he said.

Earlier this year, the International Monetary Fund (IMF) urged Latvia, which has one of the fastest rates of growth in the European Union, to slow down economic expansion to prevent the economy fro overheating.

The Latvian economy grew by 10.2 percent in 2005, which was then its highest annual rate since the country regained independence from the Soviet Union in 1991.

In 2004, the year Latvia joined the European Union, GDP rose by 8.5 percent.