Canada’s exchange traded funds (ETFs) have been lackluster over the last few months, and they may become more so if the government’s forecasts for growth are spot-on.

Canada is experiencing economic sluggishness, giving the Bank of Canada a reason to lower its growth forecast for next year while holding the policy rate at 1%, reports Madhavi Acharya Tom Yew for Teh Spec. The government now expects 2.5% growth in 2011. [Aussie, Canadian Dollar Near Parity.]

Will the low rates be enough to trigger growth? Here’s hoping, because current forecasts say that Canada’s economy will likely grow by only 3% this year. Much of that growth came earlier in the year. [4 Reasons To Watch Canada’s ETFs.]

CNBC News reports domestic  spending has slowed in the Northern country’s economy. That, combined with the weakening U.S. economy and a strengthening Canadian dollar, does not help.

  • CurrencyShares Canadian Dollar Trust (NYSEArca: FXC)
  • iShares MSCI Canada (NYSEArca: EWC)
  • IQ Canada Small-Cap ETF (NYSEArca: CNDA)

Read the disclaimer; Tom Lydon is a board member of Rydex|SGI.

Tisha Guerrero contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.