The OECD has lowered its projections for Canadian, American and global economic growth over the next two years.
The Paris-based economics think-tank now estimates Canada’s economy will grow by 1.4% in 2016, slightly more than the 1.2% estimated for 2015 but less than the OECD’s previous estimate for this year of 2% growth.
Canada’s economic growth is expected to pick up to 2.2% in 2017, but that would be 0.1% less than previously thought.
The OECD also expects U.S. economic growth over the next two years will be slower than the 2.4% estimate for 2015.
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The Organization for Economic Co-operation and Development also lowered its outlook for global economic growth to 3% in 2017 and 3.3% in 2017 – a decrease of 0.3 for both years.
It points to recent weak data from major economies including the United States and Canada as well as financial instability that’s reflected in the fall of equity and bond prices worldwide.
“The world economy is likely to expand no faster in 2016 than in 2015, its slowest pace in five years. Trade and investment are weak. Sluggish demand is leading to low inflation and inadequate wage and employment growth,” the OECD said.
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“The downgrade in the global outlook since the previous economic outlook in November 2015 is broadly based, spread across both advanced and major emerging economies, with the largest impacts expected in the United States, the euro area and economies reliant on commodity exports, like Brazil and Canada.”
The estimate for U.S. growth has been lowered by 0.5 to 2% in 2016 and by 0.2 to 2.2% in 2017. There were also downgrades for the other G7 countries – Germany, France, Italy, Japan and the United Kingdom – as well as Brazil.
The forecasts for China held steady at 6.5% growth in 2016 and 6.2% in 2017. India’s growth estimate for 2016 was raised to 7.4%, up 0.1, while the 2017 estimate was lowered to 7.3%, down 0.1.
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