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Manufacturing Strength in July Signals Robust Freight Demand Ahead

Manufacturing activity showed strength in July, with the Purchasing Managers' Index reaching 55.3% — its highest level since May 2022 — while the ISM manufacturing index climbed to 58.9%, signaling broad-based industrial expansion.

The readings carry significant implications for carriers and brokers. Customer inventories registered at 40.6%, a level manufacturers described as inadequately low, positioning the industry for substantial replenishment demand. Production reached 58.3%, with backlogs also rising, while new orders increased across the sector.

Manufacturing employment turned positive, with 60% of surveyed companies actively hiring. Capacity constraints remain tight due to regulatory pressures, a dynamic that could accelerate rate movement if freight volumes track manufacturing momentum into the traditional fall peak season.

Analysts identified late August as a critical inflection point to monitor for sustained demand trajectory.