New York Fed launches global supply chain pressure index

By Aysu Bicer

ANKARA (AA) - The Federal Reserve Bank of New York announced Wednesday the monthly publication of a new research product focused on assessing the intensity of global supply chain disruptions.

The Global Supply Chain Pressure Index (GSCPI), a single measure of global supply chain pressures, will be updated regularly at 10 a.m. ET on the fourth business day of each month.

The GSCPI can be employed to gauge the importance of supply constraints with respect to economic conditions and how those constraints evolve.

"The GSCPI is an important product because everyone across the global economy has been impacted by factory shutdowns, mobility restrictions, and widespread lockdowns during the COVID-19 pandemic," said Jan Groen, economic research advisor at the New York Fed’s Monetary Policy Research Division.

"Our index provides one bird’s-eye view of potential disruptions as well as regional indicators for analyzing trade, inflation, and globalization trends across the US, China, Japan, the Euro-area, South Korea, Taiwan, and the UK," he added.

Supply chain operations have become a major problem since the start of the coronavirus pandemic and assessing the intensity of the issue has posed a challenge because conventional measures are largely focused on specific dimensions of global supply chains.

The GSCPI integrates more than 27 variables from commonly used metrics, including data from global transportation costs and regional manufacturing surveys across seven economies, to track shifts in supply chain pressures from 1997 to the present.