FX.co ★ Texas Manufacturing Business Conditions Continued to Worsen

In June 2025, the Dallas Fed's general business activity index for Texas manufacturing rose to -12.7 from May's figure of -15.3, signaling a fifth consecutive month of contraction but with signs of moderation. Output remained unchanged for the second month, with the production index steady at 1.3. New orders continued to be negative at -7.3, while shipments declined to -7.3, and capacity utilization hovered near zero at -1.0. The company outlook index saw a slight improvement to -8.9, though uncertainty increased to 15.2, highlighting a growing sense of caution amid persistent weakness in the sector. Labor metrics revealed a modest uptick in hiring, with the employment index registering at 5.7, although the number of hours worked decreased to -8.4, indicating shorter workweeks. Price pressures remained high, with finished goods prices climbing to 26.1—the highest level in nearly three years—while wage growth was restrained, with the wages index dipping to 13.4. Looking ahead, manufacturing prospects remained cautiously optimistic, with the future production index at 22.6 and the future business activity index exceeding the average.