Dallas Fed data showed service-sector growth accelerated to its fastest pace in 11 months as input-cost pressures eased, selling prices rose and firms grew more optimistic about business conditions.
Texas service-sector activity accelerated in July 2026, with the Dallas Fed's general business activity index for services rising to 6.6 from 2.9 in June, the strongest pace of growth in 11 months. The reading was described as consistent with other surveys during the period as Middle East energy exports were briefly restored, helping lower energy prices and operating costs and improving margin prospects for service firms. Revenue growth eased slightly, with the revenue index at 9.8 versus 9.5 in June, while the hours worked index increased to 4.9 from 3.6. Cost pressures moderated as the input prices index slowed to 33.5 from 36.5, but firms raised selling prices more sharply, with the selling charges index jumping to 14.2 from 7.7. Looking ahead, companies became more upbeat about the business environment, with the general business conditions index rising to 21 from 17.1.