WASHINGTON D.C.: Production in the United States clocked slower growth last month, as supply scarcities posed restraints and extensive fiscal stimulus gave a free rein to the contained demand.
A study conducted by the Institute for Supply Management (ISM) on May 3 found the longest-ever lead times, coupled with extensive reductions in crucial basic substances, a spike in commodity costs, as well as problems in the transportation of products across businesses.
Supply chains have borne the brunt of the COVID-19 crisis, which has continued to plough on.
"Companies and suppliers continue to struggle to meet increasing rates of demand due to coronavirus impacts limiting the availability of parts and materials," according to the ISM.
"Manufacturing is struggling to keep up with roaring demand," the senior economist at NY-based FHN Financial, Will Compernolle, stated, as quoted in Reuters.
According to the institute, the manufacturing PMI in April fell to 60.7, after soaring to 64.7 in March, the highest since December of 1983. A poll of economists that Reuters conducted projected the figure to reach 65 in April.
The U.S. Congress' passage of a substantial relief aid, amounting to US$1.9 trillion, to better tackle the COVID-19 crisis, coupled with the COVID-19 inoculation program being extended to the entire adult populace in the U.S., had fueled demand that has been placing constant pressure on supply restrictions.
Jerome Powell, chair of the Federal Reserve, said recently that the Federal Reserve System projects bottleneck issues to be solved, as the workforce and businesses have begun adapting.
"We think of them as not calling for a change in monetary policy," Powell told Reuters.