The Manitoba economy isn’t doing as well as expected, according to the latest provincial forecast from the Royal Bank of Canada.
RBC Economics said today it has lowered its 2013 economic growth forecast for Manitoba to 2.5 per cent from 2.7 per cent.
It blamed the downgrade on a weak first-half performance by the province’s manufacturing sector.
"The disappointing outlook for Manitoba’s manufacturing activity this year is a key factor restraining the province’s economic recovery," said Craig Wright, the bank’s senior vice-president and chief economist.
"As fiscal restraint eases in the second half of this year, strengthening demand for provincial machinery and transportation equipment will boost manufacturing output to 3.5 per cent, reviving the sector as one of Manitoba’s key economic drivers," Wright added.
It said stronger than anticipated electricity production also should help offset the weakness in manufacturing activity to some degree.
Despite the downgrade, RBC said it still expects Manitoba to post the fourth-strongest provincial economic growth in the country this year and the fifth strongest — 2.6 per cent — in 2014.