Post-pandemic boom poised to get smacked with severe shortages

Production and shipping bottlenecks have cropped up around the world, a result of the coronavirus pandemic; severe weather events like the winter storm in Texas; a shortage of computer chips serious enough to spur President Joe Biden to summon CEOs to the White House; and even that ship that got stuck for days in the Suez Canal. Federal Reserve surveys show that delivery times are more delayed than at any time since 1951. Compounding those difficulties is the unexpectedly sharp rebound in many sectors of the U.S. economy — an uneven reopening that makes it all the more difficult to predict what people will spend money on and ensure that supply is there to meet demand. All of this raises the stakes for the Fed. Despite the raft of positive headlines around soaring consumer purchases and lower jobless claims, the disruptions have led to an uptick in costs for companies in industries from furniture to food. That could lead to a surge in inflation if passed along to consumers, putting a drag on Biden’s hopes for a robust recovery and fueling pressure on the central bank to raise rates far earlier than it wants to.