Supply-Chain Inflation: Transitory or Durable?

Early-2021 saw synchronous gains for commodity prices, prompting predictions of an imminent commodity super cycle. Price increases both resulted from, and contributed to, supply-chain bottlenecks and broader price inflation in the world economy. Looking ahead, while cyclical inflation drivers may ease, policy choices on economic regeneration, the energy transition, and the reshoring of manufacturing could raise supply-chain costs on a more structural basis over the longer term. The article is based on the author’s presentation at the JPMCC’s August 2021 international commodities symposium.