Brazil's economic activity beats expectations in September

SAO PAULO, Nov 14 (Reuters) - Economic activity in Brazil increased more than expected in September, yet another sign of strength after the central bank accelerated its monetary tightening pace.

The IBC-Br index, a leading indicator of gross domestic product, rose by a seasonally adjusted 0.8% from the previous month, the central bank said on Thursday, higher than the 0.5% rise predicted by economists polled by Reuters.

It marked the fastest monthly increase since a 1.3% rise in June.

The index based on proxies for output volume in agriculture, industry and services, as well as tax data on production, was up 3.0% over the past 12 months on a non-seasonally adjusted basis, the central bank said.

Recent data from Brazilian statistics agency IBGE showed that

services

activity in Latin America's largest economy hit a record high in September, while

industrial output

surprised on the upside and

retail sales

also rose.

Brazil's central bank recently stepped up its tightening pace with a 50 basis-point hike that pushed rates to 11.25%, as stronger-than-expected economic data, a tight job market and rising inflation expectations paint a worrying picture for the monetary authority's fight to slow price increases. (Reporting by Luana Maria Benedito and Camila Moreira Editing by Peter Graff)