Uncertainty ahead of the referendum on British membership of the EU is having an impact on investment in the UK.
The Confederation of British Industry (CBI) says it now expects economic growth of 2% both this year and next.
That is down from previous estimates of 2.3% and 2.1% respectively.
It says uncertainty around the UK's EU membership is now having a "tangible impact" on the spending plans of some British firms.
Carolyn Fairbairn, CBI Director-General, said: "A dark cloud of uncertainty is looming over global growth, particularly around weakening emerging markets and the outcome of the EU referendum, which is chilling some firms' plans to invest".
"At present, the economic signals are mixed - we are in an unusually uncertain period".
It also warns that the deterioration in the global economic outlook, including weaker prospects for China and other emerging markets, continue to represent "major challenges".
