New York Fed says supply chain pressures rose last month relative to August

The Federal Reserve Bank of New York reported on Tuesday that supply chain pressures intensified slightly in September, according to a new analysis. The bank's Global Supply Chain Pressure Index increased to 1.28 in September from the revised 1.20 in August. The report did not specify the factors contributing to this rise in the index, which gauges the operational efficiency of global supply chains.

Notably, while the pressure level rose in September, it remains lower than its peak of 1.81 in May, indicating a decline from the severe disruption levels seen in December 2021. This pandemic-induced peak of 4.43 was significantly higher than the current reading. Supply chain pressures, if left unchecked, can exacerbate inflationary pressures.

In response to rising inflation, Federal Reserve officials increased their target interest rate last month and have scheduled another hike for the end of the year, aiming to curb elevated price pressures and bring them back to the 2% target.