TORONTO (Reuters) - The pace of growth in the Canadian manufacturing sector accelerated in September to its highest level in over a year, helped by a jump in new orders and exports, data showed on Tuesday.
The RBC Canadian Manufacturing Purchasing Managers' index (PMI), a gauge of manufacturing business conditions, rose to a seasonally adjusted 54.2 last month from 52.1 in August, making for the highest level since June 2012.
A reading above 50 shows growth in the sector.
The forward-looking new orders measure rose to 56.1, while new export orders rose to 54.8, the best showing since March 2011.
"The global economy is gaining traction, and, with that, we are seeing increasing demand for Canadian exports - particularly from the manufacturing sector," Craig Wright, chief economist at RBC, said in a statement.
"An anticipated strengthening in global economic growth, particularly in the U.S. which is Canada's largest trading partner, bodes well for manufacturing activity late this year and early next."
After contracting earlier in the year, the sector has expanded for six months in a row, though the rate of growth has been somewhat stagnant in recent months.
Data released on Monday showed the Canadian economy overall rebounded in July from temporary disruptions the month before, though it was still growing at a rate well below the Bank of Canada's estimate of the potential growth in output.
The RBC PMI data also showed the pace of manufacturing employment growth hit a 15-month high, with about 17 percent of firms hiring additional staff, boding well for September's more comprehensive labor market report due next week.
Editing by Jeffrey Hodgson and Chizu Nomiyama