US supply chain conditions maintain an encouraging course

Supply chain stress has eased significantly despite resilient consumer and business spending, a reassuring development for the inflation outlook. We expect normalizing spending patterns and tighter lending conditions to help loosen lingering supply chain constraints, though there may be some bumps along the way, namely a potential labor strike at West Coast ports.

What you will learn:

• Our supply chain stress tracker fell again in May, with fairly broad-based declines pushing the tracker to nearly half its peak value from March 2022. Price and transportation pressures eased, inventories declined, and weaker manufacturing drove activity lower. Labor was the only component to register an increase, albeit marginally, as tightness persists in the job market.