12:40 PM EDT, 08/26/2024 (MT Newswires) -- Texas manufacturing activity improved more than expected this month into shallower contraction territory as production and shipments swung positive, according to the Federal Reserve Bank of Dallas.

The general business activity index edged up to minus 9.7 in August from minus 17.5 the month prior, data from the Fed branch showed Monday. Analysts surveyed in a Bloomberg poll were expecting a smaller month-over-month improvement to minus 16.

Production, which the Dallas Fed calls a key measure of state manufacturing conditions, swung to 1.6 from minus 1.3. Shipments rebounded to 0.8 from minus 16.3 in July. New orders improved to minus 4.2 from minus 12.8 month to month, the regional Fed's survey showed.

August marked "another month of little to no growth" amid demand weakness, said Emily Kerr, senior business economist at the Dallas Fed. About a quarter of Texas businesses said they were impacted by Hurricane Beryl and other recent storms, the Dallas Fed said. The survey was taken from Aug. 13-21.

The employment index fell to minus 0.7 in August from 7.1 the month prior, the Fed branch's data showed. The share of firms saying they are understaffed continues to decline while Kerr said employment levels were "stable overall."

There was "moderate upward pressure" on prices and wages this month, with the prices paid index climbing to 28.2 from 23.1 month to month, according to the regional Fed. The prices received index climbed to 8.5 from 3.4.

Six months out, the gauge for general business activity slid to 11.6 in August from 21.6 in July. The future production index ticked up to 33.7 from 32, while the forward-looking indicators for new orders and shipments increased by 0.4 and 1 point to 30.7 and 30.1, respectively. While outlooks softened, expectations for future activity remained positive overall, Kerr said.

Firms indicated that they expect both input and selling prices to moderate slightly over the next six months, while the labor indicator both edged higher.