* HSBC PMI rises to 52.2 from 50.2 in October
* Output, new orders increase
* Report follows disappointing Q3 GDP numbers
By Silvio Cascione
SAO PAULO, Dec 3 Brazil's manufacturing expanded in November at the fastest rate in nearly two years, a private survey showed on Monday, suggesting a gradual improvement after surprisingly weak economic growth in the third quarter.
The HSBC Purchasing Managers' Index for the Brazilian manufacturing sector rose to 52.2 in November from 50.2 in October, the highest in 20 months and above the 50 mark that divides expansion from contraction.
New orders grew for the second straight month and at the quickest pace since February 2011 as companies reported stronger demand, offsetting a drop in new export orders.
The report compiled by Markit adds to evidence that a flurry of stimulus measures by the government is slowly lifting Brazilian manufacturers, who have been battered by the global economic slowdown and high labor costs.
Brazil's economic recovery has been much slower than expected. Government data on Friday showed Brazil's gross domestic product expanded just 0.6 percent in the third quarter, far below all forecasts in a Reuters poll.
The weak figures cast doubt on the improvement expected for next year, and piled up pressure on President Dilma Rousseff to enact much deeper reforms instead of relying mostly on targeted tax breaks and interest rate cuts.
The level of employment in the manufacturing sector remained practically unchanged in November, according to the PMI survey.
Inventories of finished products increased slightly, reversing a small drop in October.
Prices of finished goods rose for the ninth straight month, but at the slowest rate since July. Companies reported higher costs of petrochemical products and transportation.
Brazil's statistics agency IBGE will release on Tuesday official industrial output numbers for the month of October. Leading indicators such as sales of corrugated paper point to a recovery from a 1 percent drop in the previous month.