The ISM Manufacturing PMI in the United States climbed to 55.6 in July 2026 from 53.3 in June, surpassing market expectations of 54.0 and marking the strongest expansion in factory activity since May 2022. The improvement was led by a sharp acceleration in output, which rose to 58.5 from 52.2, the fastest pace since November 2021, alongside solid growth in new orders (56.7 vs. 56.0).
Employment moved back into expansionary territory for the first time since January 2025, with the employment index increasing to 52.8 from 49.7, its highest level since August 2022. At the same time, cost pressures eased, while the Supplier Deliveries Index pointed to deteriorating delivery performance for the eighth consecutive month.
Manufacturing activity continued to be supported by businesses front-loading orders to guard against potential supply disruptions and rising costs related to the US–Israeli conflict with Iran. In addition, robust AI-related investment helped mitigate the adverse effects of import tariffs, and relatively low business inventories left scope for further expansion.
