Many Asia Pacific economies have imposed tighter restrictions that in some cases have included factory closures, raising the risk of negative spillovers at a time when supply chain disruptions are already at record levels, said the US bank.
While previous lockdowns among Asia Pacific countries have been associated with only modest increases in US supplier delivery times, this time might be different suggests the broker especially if new restrictions constrain semiconductor or auto production in the region.
China adopting tighter restrictions on exports to the US of several currently constrained goods are another potential hurdle
Any setbacks in the Asia Pacific region could also pose an upside inflation risk, especially for autos and other goods that require semiconductors plus add another spike to already high shipping costs.
“We also see several inflation risks from Delta-related restrictions in the Asia Pacific region,” said Goldman.
“First, further delays in the rebuild of auto inventories would push back the timeline for new and used car price normalization. Second, any further hit to semiconductor output could raise prices on a range of consumer electronics that require them.
“Third, port closures or stricter virus control measures at ports could further increase shipping costs from East Asia to the US, which are already extremely high due to container shortages and remaining restrictions on international transport services.”