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A collapse in trade growth suggests that globalization may be stalling and is contributing to a stagnation in world economic output, the Organization for Economic Cooperation and Development said.

The OECD trimmed its global growth forecasts by 0.1 point for this year and next to 2.9 per cent and 3.2 per cent, respectively. The volume of world trade declined in the first quarter and will fall short of overall output growth in the full year, the Paris-based organization said Wednesday in a report.

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The OECD also slashed its growth estimate for Canada this year.

The think-tank says it expects the Canadian economy to grow by 1.2 per cent this year, half a percentage point lower than its outlook in June.

Growth next year is expected to be 2.1 per cent, down from its earlier estimate of 2.2 per cent.