Morgan Stanley issued a note on Monday raising its forecast for the July ISM Manufacturing Purchasing Managers Index to 53.8, an increase from the 53.3 level it had projected for June. The upward revision is attributed to stronger manufacturing activity in Texas during July, where the region recorded gains in both demand and output, and employment in the sector continued to expand throughout the month. Supporting this view, the Dallas Federal Reserve’s ISM‑equivalent index climbed to 53.3 from 52.9, a rise driven primarily by higher production figures and an increase in new orders. While both input and output price measures showed a slowdown in July, Morgan Stanley noted that the prices‑paid index may not have fully captured the recent uptick in energy prices. Additionally, the bank observed that longer delivery times and a continued build‑up of inventories point to robust demand rather than a resurgence of supply‑chain constraints. The article, authored by Garrett Cook and published on 27‑07‑2026 at 09:42 pm, was generated with AI assistance and reviewed by an editor, with Reuters as the source.