TORONTO (Reuters) - Canadian manufacturing activity grew at its fastest pace on record in March as easing of COVID-19 restrictions helped bolster production and new orders, data showed on Thursday. The IHS Markit Canada Manufacturing Purchasing Managers’ index (PMI) rose to a seasonally adjusted 58.5 in March from 54.8 in February, posting the highest reading in the 10-year history of the survey. A reading above 50 shows growth in the sector. “Canadian manufacturers ended the first quarter of 2021 on an upbeat note,” Shreeya Patel, an economist at IHS Markit, said in a statement. “The growth was driven by stronger demand as COVID-19 restrictions continue to ease across the provinces.” The new orders index rose to 58.0, its highest since November 2013, from 54.4 in February, while the measure of output was at 57.7, up from 52.0. Last month, the Bank of Canada said it now expected the economy to grow in the first quarter, an upgrade from its January forecast of a contraction, saying it was proving more resilient to a second wave of COVID-19 infections than expected. On a more cautious note, material shortages and border restrictions linked to the pandemic contributed to the greatest lengthening in lead times since April last year, IHS Markit said. The suppliers’ delivery times index fell to 28.7 from 34.0 in February, while the measure of input prices rose to the highest since August 2018. Still, manufacturers were upbeat about their prospects for growth in the year ahead, with the future output index climbing to 67.6, its highest level since May 2019.