The defeat keeps Denmark in last place in Group B, having lost all four of their matches in the tournament. They will now play Germany in the early game on 2 January to determine which team will remain in the top pool for 2027 and who will be relegated to Division I-A.
"It was a tough game," said Danish captain Anton Linde to IIHF.com. "We are both hard-working teams, but they scored on their chances, and we didn't."
"The first period was really good. It was only 1-0 for them, and both teams had chances. But in the second, they came with a lot of speed and power, and we were standing around a bit. That might have decided the game right there."
This is the fifth successive Junior World Championships that the Latvians have played in the top division, and the fourth time they have qualified for the playoffs.
The Danes are back in the tournament for the first time since 2019 and will be playing Germany for the first time in U20 history.