US Logistics Sector Slows for 2nd Straight Month in August

The US Logistics Managers’ Index fell for a second consecutive month to 66.6 in August 2026, from 68.9 in July, pointing to the slowest growth in the logistics sector in six months. The decline was driven by a slowdown in inventory expansion, while logistics costs continued to rise at a high pace. Inventory Levels eased (-2.2 to 52.8), primarily driven by Upstream. However, expansion in Inventory Costs continue apace (+1.6 to 78.6), which is their second-fastest rate of expansion in 12 months. There were similar dynamics in warehousing and transportation. Warehousing Capacity moved up (+7.2 to 53.5), its fastest rate of expansion all year, while Warehousing Prices remained elevated (-0.5 to 75). Transportation Capacity is still contracting (+11.6 to 40) but Transportation Price expansion is up (+3.1 to 90). Essentially, the August report paints a picture of logistics costs that seem to be rapidly increasing no matter what the underlying situation is.

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.

The Logistics Manager’s Index in the US increased to 71.1 in June 2026 from 69.5 in May, pointing to the strongest growth in the logistics sector since March 2022. The upward push is mostly due to much faster expansion in Inventory Levels (+5.7 to 60.5), largely traced to surges among larger respondents and Downstream retailers. The push from retailers is likely representative that consumer spending has held through the first half of the year despite of inflation, giving retailers confidence in bringing forward goods for the second half of the year. Also, tariffs may increase in later July, so some of what we’re seeing is a pull-forward ahead of peak season. The move in Inventory Levels led to subsequent increases in Warehousing Utilization (+6.5 to 69.4), Warehousing Prices (+3.0 to 73.8) and Transportation Utilization (+5.2 to 74.7). At the same time, Warehousing Capacity (-3.0 to 47.5) moved back into contraction as more storage space is needed to accommodate increased inventories.