Transportation Secretary Pete Buttigieg acknowledged Wednesday that despite the Biden administration’s efforts to address bottlenecks, it will take time to get supply chains back to normal.
“There are going to be disruptions and shocks to the system as long as the pandemic continues,” Buttigieg told CNN’s Jim Sciutto.
‘There are no bright spots’
To measure the logistical strains impacting the economy, Moody’s recently created a US supply chain stress index that is made up of various metrics for production, inventory and transportation. That index climbed to 135.9 in August, compared with pre-pandemic levels of about 100.
Moody’s said early signs point to another increase in the supply chain stress index for September, driven by the further price increases.
“Stress in US supply chains isn’t abating,” the economists wrote.
In an interview, Colyar said none of the underlying metrics are showing improvement at this point.
“Everything is moving in the wrong direction,” he said. “There are no bright spots,”
Supply chain stress is slowing the economy
The logistics nightmare is posing a real obstacle for the economic recovery from Covid-19.
Moody’s warned that “sand in the gears” of the global economy could cause the US economy to grow more slowly than previously forecast.
Indeed, there is a risk that the US economy barely grew at all in the third quarter, which ended in September.
That’s down sharply from a call for GDP growth of 1.2% as recently as last week, and nearly 4% last month.
Wall Street economists, however, are much more optimistic and are calling for GDP growth of almost 4% — although that’s down from forecasts over the summer.
CNN’s Nathaniel Meyersohn contributed to this report