The impact of the energy crisis on the global economy in recent months is showing up in gauges of supply-chain stress that flashed red during the pandemic, adding to reasons for central banks to be on guard for a recurrence of high inflation.
The following dashboard of logistics activity shows that some gauges are at their highest since the 2020-23 period, when economies locked down, shortages emerged and shipping snarls persisted.
While the indexes are still far from their Covid highs, they reflect disruptions to global trade from the Iran war that bear some similarities to what happened back then. Logistics captures the movement of goods between suppliers, factories and final consumers, and accounts for an estimated 10% of world GDP, showcasing its important role in the global economy.
“The closer we get towards actual quantity constraints on key commodities, the more upwards pressure we’re likely to see on prices,” said Shanella Rajanayagam, a trade economist at HSBC Holdings Plc.
Earlier on Tuesday, data from the US Bureau of Labor Statistics showed rising costs for gasoline and groceries as the consumer price index advanced by the most since 2023. After adjusting for inflation, wages fell for the first time in three years.
Fed Gauge
Fresh strains are reflected in the Federal Reserve Bank of New York’s Global Supply Chain Pressure Index. After going quiet for the past three years, it’s risen for three straight months — with an especially pronounced increase in April to the highest level in almost four years.
