Canadian business confidence has plunged to the lowest level in 18 months amid increasing concerns about the impact of U.S. tax cuts, a weak loonie and NAFTA uncertainty, according to a report released Monday by the Conference Board of Canada.

The Conference Board’s Index of Business Confidence fell 6.9 points to 93.1 in the first quarter, with business leaders saying they do not expect last year’s sales momentum to continue in 2018, the report said.

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"Canada's businesses had been experiencing relatively high levels of confidence in the economy throughout most of 2017 but business confidence reversed course in the final quarter of the year,” said Matthew Stewart, director of national forecasting with the Conference Board, in a release.

“The first-quarter results for 2018 are closer to the 2016 average, a sign that businesses see the economy moving into a new, slower-growth phase."

The share of firms believing that it’s a good time to invest in machinery and equipment declined significantly to 34 per cent from 52 per cent, the Conference Board said. About half of the firms surveyed cited government policy as negatively affecting spending plans.

The findings come amid a growing chorus of critics warning that Canada is losing ground when it comes to global competitiveness.

Federal Finance Minister Bill Morneau said Friday that he won’t accept the argument that Canada isn’t competitive, following comments by former Bank of Canada Governor David Dodge that the country is doing a number of things to “shoot ourselves in the foot.” 

The Conference Board’s survey was conducted from March 9 to April 13.