Dallas Manufacturing Sector Strong On Energy Prices

Energy prices are strong and the Dallas manufacturing sector shows it, with the general activity index at 32.3 in July which is down from June's overheated 36.5 but still just over Econoday's consensus. Showing outright acceleration is the production index, up more than 6 points to 29.4. And despite delivery snags being reported across the manufacturing sector, shipments also accelerated in July, up 5 points to 30.8.

Order indications are strong but did slow slightly which is probably a positive that will give the sample some breathing room. Outlook readings also slowed on what the report describes as rising uncertainty, especially the company outlook which nevertheless remains strong. Other readings include rising strength in employment and rising hours worked. Price and wage pressures remain highly elevated.