Factory orders and trade activity declined during early summer. Here are the five things we learned from U.S. economic data released during the week ending August 8.
Factory orders declined in June. New orders for manufactured goods slumped 4.8 percent to a seasonally adjusted $611.7 billion. The Census Bureau measure has totaled $3.642 trillion year-to-date, up 3.8 percent from the comparable 2024 months. Much of June’s decline was due to a 51.8 percent drop in civilian aircraft orders. Removing all of transportation (motor vehicles: -0.7 percent) leaves new orders up 0.4 percent for the month (with year-to-date orders 0.6 percent ahead of year-ago levels). Durable goods orders slumped 9.4 percent, while those for nondurables increased 0.5 percent. Shipments grew 0.5 percent and were up 1.0 percent year-to-date. Unfilled orders rose 1.0 percent to $1.470 trillion, and inventories swelled 0.2 percent to $845.6 billion.
The trade deficit fell in June as both exports and imports slowed. The Census Bureau and the Bureau of Economic Analysis report exports declined 0.5 percent to $277.3 billion and imports declined 3.7 percent to $337.5 billion. The resulting trade deficit of -$71.7 billion was down 16.0 percent from May. (Note that import and deficit data have been particularly volatile this year as companies have tried to adjust in the current tariff-happy environment.) The year-to-date trade deficit of -$582.7 billion was up 38.3 percent from the same period in 2024. The goods deficit narrowed by $11.4 billion to -$85.8 billion, while the services surplus inched up $0.1 billion to +$25.7 billion. The former was the result of declines in imported pharmaceuticals, crude oil, and automotive vehicles/parts. The U.S. had its largest goods trade deficits with Mexico, Vietnam, Taiwan, and the European Union.
Services sector activity barely increased in July. The Services PMI, by the Institute for Supply Management, lost 7/10ths of a point to 50.1. This was the second straight month (and the 12th time over the past 13 months) in which the Services PMI was above 50, indicative of an expanding service sector. Falling were measures for business activity/production, new orders, employment, and supplier deliveries. Eleven service industries reported growth, led by transportation/warehousing, wholesale trade, and finance/insurance. The press release noted survey respondents commented about “a noticeable increase” in higher commodity prices because of tariffs.
Productivity grew in Q2. The Bureau of Labor Statistics estimates nonfarm business labor productivity rose 2.4 percent on a seasonally adjusted annualized basis, the result of a 1.3 percent gain in hours worked and a 3.7 percent boost in output. Over the past year, nonfarm business output grew 2.3 percent as hours worked increased 1.0 percent, resulting in labor productivity swelling 1.3 percent. Manufacturing productivity increased 2.1 percent during Q2 and has risen 1.3 percent over the past year. Productivity for durable and nondurable manufacturing was up 3.3 percent and 1.2 percent, respectively, during the quarter.
Wholesale sales and inventories edged up in June. Merchant wholesalers’ sales grew 0.3 percent to a seasonally adjusted $698.5 billion. The Census Bureau figure was up 5.5 percent from a year earlier. Sales of wholesale durable goods advanced 0.5 percent (automobiles: -0.7 percent) while those of nondurables eked out a 0.1 percent gain. Wholesaler inventories inched up 0.1 percent to $906.3 billion (+1.3 percent versus June 2024). Inventories of both durable and nondurable wholesale goods expanded 0.1 percent. The inventory-to-sales (I/S) ratio of 1.30 matched that of May but was off five basis points from a year earlier. The I/S ratios for durable and nondurable goods were 1.66 and 0.95, respectively.
Other U.S. economic data released over the past week:
- Jobless Claims (Week ending August 2, 2025, First-Time Claims, seasonally adjusted): 226,000, +7,000 vs. the previous week, -8,000 vs. the same week a year earlier). 4-week moving average: 220,750 (-7.8% vs. the same week a year earlier).
- Vehicle Sales (July 2025, Automobile and Light Truck Sales, seasonally adjusted annualized rate): 16.411 million (+7.1% vs. June 2025; +3.5% vs. July 2024)
- Consumer Credit (June 2025, Outstanding Non-Real Estate-Backed Credit Balances, seasonally adjusted): $5.055 trillion (+$7.4 billion vs. May 2025; +0.5% vs. June 2025).
- Senior Loan Officers Opinion Survey
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What We Learned About the U.S. Economy Last Week 