The Institute for Supply Management's manufacturing index slipped to 52.7 last month from 53.5 in June. Economists had expected the index to remain unchanged. Any reading above 50 indicates growth.
The index had risen in May and June before slipping last month. It hit a 12-month high of 58.1 last August.
Factories' exports are contracting, partly because a strong dollar makes U.S. goods more expensive.