HILLA, Iraq, Jan 7 (Reuters) - A car bomb exploded in a market in the Iraqi town of Hilla south of Baghdad on Sunday, killing two people and wounding 11, police and Interior Ministry sources said, adding the death toll could climb.

The explosion took place near a local government office in Hilla, 100 km (60 miles) south of the capital.

The mainly Shi'ite town, surrounded by Sunni Arab areas, has been hit by suicide bombings and sectarian violence.

In February 2005, a suicide car bomb attack killed 125 people and wounded 130 in one of the bloodiest attacks since the U.S. invasion in 2003.

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