Canadian economy

OECD cuts forecast for Canadian economic growth

Organization for Economic Co-operation and Development scales back outlook for the global economy

Finance Minister Bill Morneau speaks at the Munk School of Global Affairs in Toronto on Wednesday, January 13, 2016. The dimming economy is not the only challenge facing Morneau as he puts together his first federal budget. (Peter Power/CP)

Finance Minister Bill Morneau January 13, 2016. (Peter Power/CP)

OTTAWA — The Organization for Economic Co-operation and Development slashed its growth estimate for Canada this year as it trimmed its outlook for the global economy.

In its latest interim economic outlook, the OECD says weak trade growth and financial distortions are exacerbating slow global economic growth.

The think-tank says it expects the Canadian economy to grow by 1.2 per cent this year, half a percentage point lower than its outlook in June.

Growth next year is expected to be 2.1 per cent, down from its earlier estimate of 2.2 per cent.

The OECD cut its global forecast to 2.9 per cent for this year from its June estimate of 3.0 per cent. That’s slightly below the 3.1 per cent growth seen last year.

Global growth next year is predicted to 3.2 per cent, down from an earlier forecast for 3.3 per cent.