The current conditions component has not shown evidence of sustained growth since early 2022. After settling on the threshold value of 50 points last month, the current gauge once again slipped in July, dropping seven points to 42.9, signaling "worse" conditions overall compared to June. Although reports of "unchanged" conditions remained the most common response, the share of panel members indicating "worse" conditions jumped to nearly 30 percent of all responses in July. Despite this month's underwater reading, some bright spots emerged in the comments with reports of strength in markets such as infrastructure and utility upgrades. However, commenters also pointed out cautionary notes such as reports of customers' future spending plans being put on hold, slowing demand in some segments, and "over inventoried positions being worked down."

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