The Magazine for Asian Investors
Supply chain disruption is affecting the global economy more than at any time since the global financial crisis. This is a major factor plunging the post-pandemic recovery into a lull.
The indicators show that the supply bottlenecks in the world are having a pretty bad effect. It also puts the recovery of the global economy at greater risk.
The indicators can be seen around the world, such as the supply of goods and food in supermarkets is short, the volume of ships idled in many countries is high, the declining productivity of factories is increasing, longer waiting times and higher prices for goods/services are emerging.
Looking at the big picture, it has been determined that the current supply crisis is the worst in the last 10 years. Many central banks have begun to abandon the assumption that inflation will only occur in the short term. Even policymakers are being forced to respond to accelerating inflation. It is likely that economic stimulus will have to be reduced and the policy rate will have to be raised more quickly than previously expected.
The big question in the room right now is, “When will the supply chain disruption end?”
Therefore, we must continue to monitor whether our world will be able to control the COVID-19 outbreak and when will it return to a state where supply responds to demand?
Clearly, breakouts and labor shortages are two key factors that will determine the fate of the issue.