Strong consumer spending and exports helped Canada's economy expand in the first quarter of 2010 at the fastest pace in more than a decade, the government's statistics agency reported Monday, sparking expectations that the central bank will raise interest rates on Tuesday. Gross domestic product (GDP) grew at a 6.1 percent annual rate in the January-March period, the biggest jump since the fourth quarter of 1999. First-quarter GDP grew 1.5 percent compared with the fourth quarter of last year, Statistics Canada said. The results were slightly better than economists had expected. Consumers continue to drive the recovery from mild recession, while international trade contributed to growth for the third consecutive quarter. The housing market remained active in the first quarter because of heavy investment in new construction and home renovations by owners taking advantage of a tax credit that expired in February. In March, most industries increased production to drive growth of 0.6 percent from the previous month, with gains led by mining and energy. Most forecasters expect the Bank of Canada to raise interest rates by a quarter-percentage point on June 1 to 0.50 percent. Even with an increase, rates are near historical lows.
