An index by the Federal Reserve Bank of New York, which measures global supply chain stress, fell to a record low in May 2023, suggesting that the bottlenecks that have contributed to inflation in recent years may now be largely resolved .
The Global Supply Chain Pressure Index fell to -1.71 in May 2023 from -1.35 in April 2023, marking the lowest level since data was recorded in 1997, according to information released on June 6, 2023. It peaked at 4.31 in December 2021.
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“There were significant downsides from backlogs in the UK and delivery times in Taiwan. Delivery times and arrears in the euro area were the biggest sources of upward pressure in May,” the New York Fed said on its website. “If you look at the underlying data, the readings for all regions covered by the GSCPI are below their historical averages.”
The decline in the index, which includes 27 components ranging from measurements of global shipping costs to responses from purchasing manager surveys, points to the pressure on supply chains that began with the outbreak of the COVID-19 pandemic and to rising inflation contributed around the world has now subsided.
