U.S. Industrial Production Rises 0.2% in July

U.S. industrial production increased 0.2% in July 2026, with higher output of industrial, space and defense equipment offsetting declines in consumer goods production.

The increase followed a 0.3% gain in June, according to the latest industrial production data. Capacity utilization also increased slightly during July but remained below its long-run average.

Industrial Equipment Production Increases

Production of industrial equipment, space equipment and defense equipment increased during July, helping offset declines in both durable and nondurable consumer goods.

The data comes as manufacturing technology orders have remained elevated during the first half of 2026. According to AMT – The Association For Manufacturing Technology, U.S. manufacturing technology orders reached a record $3.44 billion during the first half of 2026, representing a 36% increase from the first half of 2025.

The elevated machinery investment has coincided with increased production activity in several industrial sectors.

Consumer Goods Production Declines

While industrial equipment production increased, output of both durable and nondurable consumer goods declined in July.

Christopher Chidzik, principal economist at AMT, said the decline could reflect differences in consumer demand across the economy.

Chidzik also noted that manufacturers of industrial, space and defense equipment could continue supporting manufacturing activity if consumer demand weakens.

Manufacturing Technology Orders Remain Elevated

The July industrial production figures follow a strong first half for manufacturing technology orders.

AMT reported that the first half of 2026 represented the strongest six-month period for the value of metalworking machinery orders since the U.S. Manufacturing Technology Orders (USMTO) program began collecting data in 1998.

The organization reported that manufacturers have continued investing in production equipment amid demand from sectors including aerospace, defense, power generation and other industrial markets.

While a decline in consumer demand could affect future machinery investment, continued demand for industrial and military equipment may provide support for manufacturing activity, according to AMT.