Global supply chain crisis ‘may have peaked’

The global supply chain crisis may have peaked according to an index from the New York Federal Reserve.

The reserve bank said the Global Supply Chain Pressure Index (GSCPI) incorporated data from several commonly used indexes.

This included data from the Baltic Dry Index (BDI), which tracks the cost of shipping raw materials and the Harpex index, which tracks the container shipping rate.

The reserve bank said the index “seems to suggest that global supply chain pressures, while still historically high, have peaked and might start to moderate somewhat going forward”.

The bank said it observed from the index that supply chain pressures jumped at the beginning of the pandemic period when China imposed lockdown measures.

The index then fell briefly as world production started to get back online around the summer of 2020 according to the bank, before rising at a dramatic pace during the winter of 2020 and the subsequent recovery period.

The news comes after a year in which supply chain issues have heavily impacted the retail industry; earlier this week IKEA confirmed that it will be hiking its UK prices due to supply chain issues triggered by the coronavirus pandemic.

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