The global economy's supply crunch is accelerating inflation at such a rapid pace that central bankers may be obliged to respond, despite the fact that correcting the imbalance is beyond their ability.

Their problem is that it's difficult to discern how much of the inflation is due to a rebound of demand when lockdowns expire, and how much is due to supply restrictions caused by clogged ports and shortages of supplies and employees.

Raising interest rates now would dampen the demand that propelled the world out of recession last year, but would do little to alleviate supply shortages. If shortages then diminish as trade returns to normal, policy may become excessively tight, stifling the recovery.

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However, if central banks continue to hold back and the supply bottleneck persists, it may entrench expectations of rising inflation, driving consumers and businesses to raise wages and prices. In that case, central banks may be obliged to slam the brakes even harder in the future.

“Trying to work out the difference between demand and supply-side drivers right now is incredibly difficult,” Stephen King, senior economic adviser to HSBC Holdings Plc, told Bloomberg Television. “Most central banks would probably admit at least in private that inflation is far higher than they had initially expected. You can see why some of them are biting their nails and becoming ever more nervous.”

According to JPMorgan Chase & Co., global consumer prices have grown more than 4% in the last year, with inflation outside of food and energy reaching its highest level in a decade.