”At this stage, we think the impact is more regional than global, with Europe more impacted than other regions.”
Macroeconomic focus
Red Sea: a new supply chain and inflationary shock in the pipeline?
Disruption in the Red Sea is prompting speculation around inflationary shocks just as in the Covid era So, what differs today from the post Covid experience to make the impact more micro than macro and more regional and sector specific than global?
There are three main factors to consider:
- Goods are traded, ports are open and trade flows continue, although it is taking longer and is more expensive;
- The shock is more regional than global, as not all regions are affected equally (the most affected trade route is Southeast Asia to Europe);
- Not all goods are affected in the same way (more sector/industry impacts).
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