The Dallas Fed’s general business activity index for Texas manufacturing rose to 0.9 in July from -12.7 in June, signaling stability after five months of decline. Factory production surged, with the production index jumping to 21.3, the highest in over three years. While new orders remained weak at -3.6, it was an improvement from June. Capacity use and shipments also turned positive. The outlook among manufacturers brightened, with the company outlook index turning positive for the first time in six months. Hiring picked up, with more firms adding workers than cutting, and work hours rose sharply. Input costs stayed high, but selling prices grew more slowly. Looking ahead, expectations for future business and production improved, with most indicators pointing to cautious optimism despite some still trailing their long-term averages.