Analytics, Economics, GDP, Latvia

''The preliminary estimate for GDP growth in the second quarter of the year shows that the Latvian economy continues to expand. Growth was determined by both positive domestic and external demand trends,'' the bank points out in its report.

If Latvia's positive GDP trends are confirmed in the final calculations, Danske Bank will raise Latvia's GDP growth forecasts for this year, writes LETA.

According to the report, Danske Bank predicts Latvia's GDP will increase by two percent this year, and approximately three percent next year.

As one of the main risks, the bank mentions the possible deterioration of external markets.

As reported, in the first quarter of 2012, Latvia's gross domestic product (GDP), according to seasonally non-adjusted data, increased 6.8% from the first quarter of 2011, according to the Central Statistical Bureau's flash estimate.

The growth in industry of 11% and in trade of 10% had a positive effect on the GDP; also the volume of collected taxes on products increased 20%. The construction sector continues to grow as well.

Compared to the fourth quarter of 2011, the GDP increased 1% in the first quarter of 2011, according to seasonally-adjusted data.