Ottawa sees the economy growing at 2.1 percent next year, compared with the 2.8 percent that was estimated in the government's June budget, Finance Minister Jim Flaherty told reporters.

The private sector forecasts will be used in the Finance Department's fall fiscal update, which Flaherty said would be released within a few weeks.

The median forecast in a Reuters poll of analysts this month was for 2.2 percent real growth this year and 2.4 percent next year, while the Bank of Canada on Tuesday pegged 2011 growth at 2.1 percent and 2012 growth at 1.9 percent.