In the longer run, these efforts may lead to more resilient supply chains, but the short-term transition could introduce different vulnerabilities. I will be watching these developments closely. As the various supply bottlenecks we are currently seeing are gradually resolved, we should see monthly inflation readings step down further from the high rates we have observed this year.
Nevertheless, I still see a material risk that supply-related pricing pressures could last longer than expected. Another source of inflation risk comes from the lower labor force participation, which, as I mentioned earlier, has led some firms to offer inducements to bring potential workers back, including hiring bonuses and higher wages.