The world economy is set to slow as the fading of the policy stimulus again exposes the underlying fragilities left by the recession. During this period of transition, growth in external demand for Canadian goods and services is already weakening. We expect this to contribute to a sub-par economic performance over the next two years, and have cut our GDP forecasts accordingly. We now anticipate growth of 2.2% in 2011, down from a previous forecast of 2.7%, and just 2.0% in 2012, down from 3.0%.
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