Fallout from China's energy crisis
China’s energy crisis shows no signs of slowing, and it’s poised to impact the flow of goods that the nation sends stateside.
Why it matters: Supply chain disruptions are a huge part of what’s holding back the world’s economic growth as it recovers from the pandemic lockdown era. Electricity blackouts in China spawned by a power shortage could make that worse.
Details: Key suppliers to tech giants like Apple, Tesla, Microsoft, HP and Dell have been forced to cease or reduce operations, the FT reports.
- Suppliers to U.S.-based makers of consumer products like water bottles and backpacks also face caps on their power usage, the WSJ writes.
- Food costs will probably rise, too. Agricultural processing plants have had to go dark, according to Bloomberg.
The bottom line: Global markets may be in for a further supply shock, which could add to inflation, Nomura chief China economist Ting Lu wrote in a research note, according to the WSJ report.