By John S. McClenahen Last month U.S. manufacturing lost some momentum in its recovery from the 2001 U.S. economic recession. Both production and capacity utilization declined from their July levels, the U.S. Federal Reserve reported on Sept. 15. Manufacturing production slipped by 0.1% in August to an index mark of 110.7 (1997=100), while capacity utilization fell to 72.7% from 72.9%. "It seems clear the rebound in manufacturing is going to be a struggle with the millstone of an uncompetitive value of the dollar and high costs of doing business around the sector's neck," says a worried Daniel J. Meckstroth, chief economist at Manufacturers Alliance/MAPI, an Arlington, Va.-based business and public policy group. Meanwhile, the U.S. Commerce Department reported that manufacturers' inventories, including semiconductors, at the end of July were at a seasonally adjusted $1.18 trillion, down 0.1% from June. The Commerce Department also said that in the second calendar quarter of this year the current account, the broadest measure of the U.S.' international economic position, remained in deficit at $138.7 billion, the same level as in the first quarter.