BENGALURU, June 1 Reuters India39;s factory activity expanded at a betterthanexpected pace last month as overall demand remained resilient despite persistently high inflation, encouraging firms to hire at the fastest rate since January 2020, according to a private survey.

The survey comes just a day after official data showed Asia39;s thirdlargest economy expanded at an annual rate of 4.1 during the JanuaryMarch quarter, its weakest in a year, amid rising risks from price pressures.

Still, the Manufacturing Purchasing Managers39; Index, compiled by SP Global, came in at 54.6 in May, slightly lower than April39;s 54.7 but above the 50level separating growth from contraction for an eleventh month.

It was better than the Reuters poll median prediction of 54.2.

While new orders, a gauge of overall demand, increased strongly last month, albeit at a slower pace, foreign demand grew at its strongest pace since April 2011 despite worries over the RussiaUkraine war, China39;s economic slowdown and high inflation.

India39;s manufacturing sector sustained strong growth momentum in May, noted Pollyanna De Lima, economics associate director at SP Global.

In response to demand resilience, companies continued with their efforts to rebuild stocks and hired extra workers accordingly.

Firms hired workers at the quickest rate in nearly two and a half years, welcome news for the labour market. Unemployment rose to 7.83 in April from 7.60 in March, according to the Centre for…