There are some underlying worries in the latest ISM PMI. Let's take a look at them.

The prices increased to 52.5 (+2.2) because of higher new order (52.5, +2.1), new export order (50, +1.3) and new local order (Est’d +0.8).  All these positive factors also caused the PMI to increase to 49.3 (+0.9).  Consequently, the higher consumer demands also caused the backlog of order (45.9, +4.1) to pile up because the production didn't catch up with the higher consumer demands.

However, there are some subcomponents that are showing worrying signs.  The producers cut back on employment (45.3, -2.8) and only increased the inventories (48.4, +0.3) marginally despite the higher production and consumer demands.  These actions meant that the producers were not confident of the recovery in the local and overseas consumer demands.