Economic growth slowing: Conference Board

The Conference Board of Canada has cut its growth forecast for the economy next year.

The Ottawa-based think-tank said Tuesday that domestic spending has cooled and the U.S. economy has weakened.

It said it now expects Canadian gross domestic product will increase by 2.5 per cent in 2011 over this year.

That was 0.4 percentage points lower than its previous prediction made less than a month ago.

For all of 2010, the Conference Board projects three per cent growth over the previous year, when Canada's GDP shrank due to a severe global economic slowdown.

The forecast came the same day as the Bank of Canada lowered its prediction for economic growth to about three per cent this year instead of the 3.5 per cent it had predicted in July. Next year, the bank predicted, the Canadian economy will grow by 2.3 per cent, 0.6 of a point lower than it previously projected.

The Conference Board said Canada's domestic economy is losing steam and the country's growth will rely on the U.S. and global economies. It added that Canada won't be helped by the strength of its currency, which Tuesday's report predicted will average 99 cents US next year.