The ISM PMI has been in a contractionary phase for 11 consecutive months already.

PMI analysis:

The prices subindex had fallen significantly to 43.8 (-4.6) because the producers used more local raw material (Est’d +1.6) compared to imports (48.2, +0.2) and the continual improvement in supplier’s deliveries (46.4, -2.2).  The producers boosted their inventories (45.8, +1.8), employment (51.2, +2.7) and production (52.5, +2.5) to meet the increment in new order (49.2, +2.4).  The increase in new order was caused by increments in new export order (47.4, +0.9) and new local order (Est’d +1.5) and depleted the customers’ inventories (47.1, -1.6).  The backlog of order decreased to 42.4 (-1.7) because of the increase in production.  Overall, the PMI increased to 49 (+1.4) but it was still in a contractionary phase (below 50).  Thus, the US economy is set to enter into a recession because the US consumers have depleted their pandemic savings.