As of Dec. 12, private sector forecasters expect that Canada’s real Gross Domestic Product will contract in 2009 by 0.4%, the Department of Finance said Wednesday.

One month ago, as of Nov. 14, the average forecast called for an increase of real GDP of 0.3%.

Finance surveys about 15 private sector forecasters on a quarterly basis for their outlook on the Canadian economy. When conditions warrant, the survey is conducted more frequently to obtain the most up-to-date information.

Finance said the updated private sector outlook reflects three interrelated developments: global economic conditions have continued to weaken; the U.S. economic outlook has worsened; and commodity prices have continued to fall.

Finance will conduct another survey of private sector forecasts in January prior to the Jan. 27 federal budget.

At the conclusion of the meeting in Saskatoon, Sask. on Wednesday, federal Finance Minister Jim Flaherty and his provincial counterparts pledged to work together to speed up the approval of infrastructure projects to get billions of dollars into Canada’s lagging economy.

IE