Canada Economic Update: Jim Flaherty, Finance Minister,

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The fall economic update is likely to show a modest deterioration in the government's finances but isn't expected to carry any major surprises. CP
The fall economic update is likely to show a modest deterioration in the government's finances but isn't expected to carry any major surprises. CP

OTTAWA, Ont. _ The federal government says its deficit will hit $26 billion this year, $5 billion more than predicted, and it expects to take a year longer to balance the budget.

The fall economic update shows that global economic weakness will push the deficit well above the $21.1 billion predicted in the March budget.

Finance Minister Jim Flaherty says he expects the deficit will be significantly higher in each of the next four years and won't be completely eliminated until 2016-17.

He says said the key problem is a weak global economy which has depressed prices for commodities Canada sells to the world.

In turn, this erodes government tax revenues.

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