Supply snags hurting US growth

The US economy continues to struggle with supply issues that have pushed prices higher in recent weeks, but there are signs the strains may be easing, the Federal Reserve said Wednesday.

Businesses in several areas of the country noted that “despite strong demand, growth was constrained by supply chain disruptions and labor shortages,” according to the Fed’s “beige book” survey of economic conditions.

However, the report said the “outlook for overall activity remained positive in most districts,” although some noted “uncertainty about when supply chain and labor supply challenges would ease.”

Rising inflation is a top issue for the US central bank, and Fed Chair Jerome Powell made a dramatic shift on Tuesday, saying he now sees a risk the price increases could continue for some time.

Powell said he supports a faster pullback of the Fed’s stimulus policies, a move that would open the door to raising lending rates sooner than expected.