Running Out Of Road
The forces we’ve been tracking in recent months, rising costs, shifting trade lanes, and geopolitical strain, are no longer moving in parallel; they are beginning to interact and reinforce one another. Raw material inflation has reaccelerated to cycle highs, driven by metals, energy, and tariff costs flowing through the entire value chain. At the same time, global manufacturing is losing momentum, with output and new orders softening as higher input costs collide with disrupted trade flows tied to the Middle East conflict. Supply chains remain functional, but flexibility is eroding as ship rerouting, fuel surcharges, and blanked sailings tighten the system’s ability to absorb shocks. Trade patterns continue to evolve, becoming more structural than cyclical. The system remains intact, but the buffers that have absorbed disruption over the past year are thinning. We are not hitting the wall yet, but we may be running out of road.
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⏱ ~15 min read
