The Federal Reserve Bank of Dallas reported that Texas' manufacturing sector saw its business activity index fall to -17.5 in July 2024, down from -15.1 in June. This marks over two years of consistent contraction for Southern manufacturing. Production levels decreased from the previous month (-1.3 compared to 0.7 in June), following a brief improvement at the end of Q2. New orders and shipments also saw significant declines (-12.8 and -16.3, respectively), highlighting ongoing weak demand. Despite a sharp drop in unfilled orders (-26.6 from -4.7), the sector continues to struggle.

This series of disappointing economic indicators may pressure the Federal Reserve to consider initiating an interest rate cut cycle, in line with actions taken by other major central banks like the ECB.