A global economic forecasting group says Canadian economic growth will outpace that of other G7 nations by a wide margin during the first half of 2010.

The Paris-based Organization for Economic Development and Co-operation is forecasting that Canada’s economy grew 6.2 per cent in the first quarter, well ahead of the 1.9 per cent overall growth for the G7 nations.

The OECD predicts that Canada’s second-quarter growth will be about 4.5 per cent, nearly double the 2.3 per cent growth expected from the combined G7.

The latest outlook comes as Canadian economic data shows the country embarked upon an enthusiastic rebound at the start of the year.

In January, Canada’s gross domestic product advanced 0.6 per cent, driven by growth in activity in factories, at construction sites, in mines and in the oilpatch.

However, economists have cautioned that Canada’s economic growth will likely slow down as the Bank of Canada is expected to raise interest rates this July, while consumers could decrease spending to pay off their debts.

In the OECD study, the organization said that growth in leading rich economies will slow in the first half of this year, with the United States and Japan outpacing sluggish Europe.

The OECD links the slowdown to the end of some government stimulus programs and the emptying of inventory stocks  all while the recovery and labour markets remain frail after the worst global recession in decades.

Most of the global economic growth this year is expected in countries not addressed in the report, such as China, India and Brazil.

Still, “overall it is an encouraging picture,” OECD chief economist Pier Carlo Padoan told a news conference about the agency’s report on the Group of Seven industrial economies. “It is stronger in the United States and Japan, it is not as strong in Europe.”

The OECD forecast that U.S. gross domestic product would rise 2.4 per cent in the first quarter and 2.3 per cent in the second quarter, down from 5.6 per cent in the fourth quarter of last year. Forecasts for Japan are 1.1 per cent and 2.3 per cent for the first two quarters of 2010, down from 3.8 per cent in the fourth quarter 2009.

Forecasts for Germany fell, however, blamed on a slump in construction activity.

The OECD urged rich governments to end stimulus programs next year or earlier to avoid sinking deeper into debt. But it warned that they should do so gradually and carefully.

“Despite some encouraging signs on activity, the fragility of the recovery, a frail labour market and possible headwinds coming from financial markets underscore the need for caution in the removal of policy support,” the report said. “Consolidation should start in 2011, or earlier where needed, and progress gradually so as not to undermine the incipient recovery.”