The Richmond Federal Reserve’s composite manufacturing index rose to 5 in July 2026, up from 4 in June, but fell well short of the consensus forecast of 10. The survey covers roughly 190 manufacturing plants across the Fifth District (Washington D.C., Maryland, North Carolina, South Carolina, Virginia, and most of West Virginia). Shipments increased to 8 from 4 in June, while employment returned to positive territory at 2. This 5-point miss signals that manufacturing growth remains modest, echoing similar subdued readings from other regional Fed banks. The subdued reading may reduce pressure for further monetary tightening and raises questions about whether July’s tepid performance marks a temporary soft patch or a more sustained slowdown.
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