The US Logistics Managers' Index eased to 68.9 in July 2026, down from 71.1 in June, which marked the fastest pace of expansion since March 2022. Although growth moderated, July's reading remains higher than any monthly reading recorded between 2023 and 2025, indicating continued strength in the logistics sector. The slowdown was driven primarily by Inventory Levels, which fell 5.5 points to 55.0 after firms pulled inventory forward ahead of July tariff increases. The decline was most pronounced among Downstream retailers, where Inventory Levels dropped from 66.0 to 46.3, suggesting that inventories built ahead of the holiday season are now concentrated Upstream at the wholesale level. Meanwhile, Inventory Costs continued to rise, increasing 1.1 points to 77.0. At 22.0 points above Inventory Levels, the gap underscores persistent cost pressures from tariffs and ongoing geopolitical conflict.