What do collapsing shipping costs mean for inflation?

from The Weekly Briefing from Capital Economics · host Capital Economics

The Ever Given made worldwide headlines when it became stuck in the Suez Canal in March 2021. The cargo ship's dilemma symbolised global supply chain disruptions that were reflected in a record surge in shipping costs. But those costs are now falling as quickly as they rose in 2020-21. What’s behind the plunge, and can this help win the battle against inflation? In this episode of The Weekly Briefing, Simon MacAdam and Leah Fahy from our Global Economics team get to grips with the rise and fall – and potential disinflationary impact – of shipping costs. Plus, Group Chief Economist Neil Shearing talks about what zero-COVID means from a global macro perspective and explains why the latest UK house price was so shocking.

What this episode covers

Global shipping costs are falling as quickly as they rose. What’s behind this unwinding of the pandemic-era price surge, and what will it mean for global inflation rates? Plus, does Beijing’s response to public anger over zero-COVID do anything to change China’s economic outlook?