A series of weak consumer spending figures, including a weak showing in the second quarter, weighed on investment demand for the year, Goldman Sachs said.
The firm expects to report its fourth-quarter fiscal 2017 earnings Thursday, and said it expects it to report lower-than-expected second-quarter revenue as well.
The latest data shows that consumer spending fell 1.3% in the first three months of the year compared with the same period last year, and it is still far below the Fed’s 2% inflation target.
U.P.E.I. GDP shrank by 0.2% in July and 1.4% in August.
That was the steepest annual decline since April 2017.
That also marked the third straight month that the U.N. World Food Program reported that the country was experiencing a famine.
“We are expecting to see a decline in food security and food insecurity as the U (food) price index is lower and the food supply is constrained,” said Matt O’Donnell, an economist at Goldman Sachs.
UMI stocks fell sharply on the news, falling as much as 2% to $26.15.
The shares were down nearly 1% in after-hours trading.
In a report to clients, the company said its global food security efforts were faltering.
It cited poor weather in Mexico, a sharp drop in demand for grains and a reduction in global food imports.
It also said that a sharp reduction in corn production, driven by the drought in Mexico and drought in Central America, will likely have a negative impact on U.T.O. growth.
Goldman Sachs estimates that U.U.S.-U.K. trade will be flat in 2018.
The U.K., by contrast, will see a 10% to 15% decline in exports, as it struggles to cope with the effect of the Brexit vote.