ISTANBUL
Supply chain pressures contributed to consumer price inflation in the US, according to the Federal Reserve Bank of San Francisco.
“Global supply chain disruptions following the onset of the COVID-19 pandemic contributed to the rapid rise in U.S. inflation over the past two years,” it said Tuesday in a report. “Evidence suggests that supply chain pressures pushed up the cost of inputs for goods production and the public’s expectations of higher future prices.”
The San Francisco Fed said those factors accounted for about 60% of the surge in US inflation beginning in early 2021, but such pressures started easing substantially in the middle of 2022.
“Following the onset of the COVID-19 pandemic, global shipping and transportation costs surged, and delivery times and backlogs spiked to historically high levels. The resulting supply shortages added significant pressure to inflation,” it said.
“Our analysis suggests that supply chain shocks can have significant impacts on PCE (Personal Price Expenditures) inflation by raising inflation expectations and intermediate input costs,” it added.
