Manufacturing activity in the US Federal Reserve’s Fifth District was little changed in August 2026, with the manufacturing index edging down to 4 from 5 in July and falling short of market expectations of 7. The reading remained above zero, indicating continued but slower expansion across Virginia, Maryland, the Carolinas, the District of Columbia and most of West Virginia. Shipments increased to 11 from 8, but new orders declined to 3 from 5. Backlogs of orders swung to -7 from 4, capital expenditures fell to -5 from 0, and employment decreased to -2 from 2. Price pressures strengthened, with the average growth rate of prices paid rising to 6.22 from 6.08 and prices received increasing to 4.09 from 3.96. The local business conditions index declined to 4 from 10. Firms remained relatively optimistic about the next six months: future new orders edged up to 32 from 31 and employment expectations rose to 20 from 15, although shipment expectations eased to 26 from 33. Expected growth in prices paid and prices received moderated, while the future local business conditions index fell to 16 from 19. The softer-than-expected result offers a signal of moderating regional momentum that investors and Federal Reserve policymakers may weigh alongside other economic data, although one month’s reading is not enough to establish a trend.