US supply chains remain on the road to recovery

Supply chain stress eased in April, which will put downward pressure on goods prices and allow the Fed to pause in its tightening. We expect supply chain issues to clear in H2 as tighter lending conditions, inventory drawdowns, and softer consumer spending alleviate stress.

What you will learn:

• Our supply chain stress tracker fell in April to its lowest since March 2021. A weaker economy and reduced logistics pressures led the declines in our proprietary tracker. Prices remain elevated, though lower commodity and transportation prices pushed this component lower on a month-on-month basis. Inventories shrank as businesses pulled back on restocking. Resilient demand for workers buoyed the labor component of our tracker.