Text along circle

[sl60]

   
I've been experimenting with this technique and ran into an issue. I want to place text along the circumference of an existing circle (a circular object as opposed to a Gimp-drawn circle). I create the circular text and Gimp places it inside the edge boundary of the object, so I used the Move Tool to position it on the outside edge of the rim. When I did this the text warped a bit. How to avoid this?

Should I have perhaps created a circle drawn by Gimp to layer over the outside rim of the circular object?

Thanks--here is an image of the warped text.