By Jonnelle Marte

(Reuters] – Some of the global supply chain pressures causing inflation may be tamed by domestic monetary policy measures, New York Federal Reserve researchers stated in a paper published Friday.

Researchers have stated that global supply chain disruptions were a key factor in the persistence of high inflation since the coronavirus epidemic, which included producer prices and goods inflation.

Researchers wrote that the global nature of these inflationary pressures and their source, which is supply as well as demand, suggest that domestic policy action would not have much effect on them.

Researchers said that inflationary pressures may ease if supply chain bottlenecks are reduced and energy prices drop. This is a reminder of some of the uncertainties policymakers must navigate in order to prevent higher inflation becoming entrenched.

Officials at the U.S. central banks indicated this week they will likely raise interest rates in March, to end the unprecedented support given during the pandemic. Jerome Powell, Fed Chair, did not offer any guidance as to the rate of future rate rises. This outlook is likely to remain uncertain as Fed Chair Jerome Powell offered little guidance on the pace of future rate increases. Officials are still waiting to see how inflation and the pandemic affect the overall economy over the next few months.

Friday’s blog post contains a New York Fed-released index. This new index found that global supply chain tensions have reached historic levels and may be at their peak. The index measures global shipping costs, air freight cost, and other variables. It fell slightly between November and December.