TORONTO (Reuters) - Canadian economic activity expanded at the fastest pace in seven months in February as employment rose and prices heated up, Ivey Purchasing Managers Index (PMI) data showed on Thursday.

The seasonally adjusted index rose to 55.3 from 47.1 in January, its highest level since July. A reading above 50 indicates an increase in activity.

The Ivey PMI measures the month to month variation in economic activity as indicated by a panel of purchasing managers from across Canada.

The gauge of employment rose to an adjusted 53.7 from 52.9 in January, while the prices index was at 71.5, up from 64.4.

The unadjusted PMI rose to 53.6 from 46.2.