TORONTO, Aug 7 (Reuters) - Canadian economic activity

expanded at a slower pace in July as a measure of inflation fell

to a four-month low, Ivey Purchasing Managers Index (PMI) data

showed on Wednesday.

The seasonally adjusted index fell to 57.6 from 62.5 in

June.

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

activity.

The gauge of employment rose to an adjusted 56.1 from 52.9

in June, while the prices index was at 59.2, down from 62.3 and

its lowest level since March.

The unadjusted PMI fell to 55.3 from 62.4.