The US ISM PMI increased to 50.3 in March 2024.

The ISM PMI increased to 50.3 in March 2024 and was the 1st month of expansion after 16 months of contraction.

Let's take a look at what happened here.

Let's calculate 2 unknown sub-indices (Estimated new local orders & local raw materials) first.

* Estimated new local orders=New orders % change (+2.2) - New export order % change (0) = +2.2%

* Estimated local raw materials=Inventories % change (+2.9) - Imports % change (0) = +2.9%

From these 2 sub-indices, we could derive that the increase in ISM PMI was driven by local consumption.  This was indeed surprising because the US consumers continue to spend in the headwinds of inflation and economic uncertainty.

As the saying goes, 1 month of data doesn't make a trend and we'll need to continue to observe the future PMIs to confirm the expansion trajectory.