Canada's Ivey PMI shows faster economic expansion in August

FILE PHOTO: Shipping containers are picture in St John's, Newfoundland and Labrador, Canada, October 17, 2018. REUTERS/Chris Wattie

TORONTO (Reuters) - The pace of economic activity in Canada picked up in August as inventories climbed, according to Ivey Purchasing Managers Index (PMI) data released on Friday.

The seasonally adjusted index rose to 60.6 from 54.2 in July, surpassing analysts’ expectations for 53.0.

The Ivey PMI measures the month-to-month variation in economic activity as indicated by a panel of purchasing managers from across Canada. A reading above 50 indicates an increase in the pace of activity.

The gauge of inventories rose to an adjusted 54.8 from 46.9 in July. Meanwhile the employment index remained above the 50 threshold, but dipped to 52.7 from 56.6.

Data from Statistics Canada on Friday showed that Canada’s economy added 81,100 jobs in August.

The unadjusted PMI rose to 58.6 from 51.2.

Reporting by Fergal Smith; Editing by Chizu Nomiyama