The booming US economy rocked the whole world, straining supply chains and driving up prices

American consumers, with trillions of dollars of fiscal stimulus, are hunting for manufactured goods and scarce raw materials.

U.S. economic output is expected to grow more than 7% year-on-year in the last three months of the year, up from about 2% in the previous quarter, according to initial output estimates released by the Federal Reserve Bank of Atlanta. That compares with expected year-on-year growth of around 2% in the euro area and 4% in China in the fourth quarter, according to the report.

JPMorgan Chase.

Major US ports are handling nearly a fifth more container volumes this year than in 2019, even as volumes at major European ports like Hamburg and Rotterdam are mostly flat or lagging. 2019 levels, according to shipping data provider Alphaliner, America’s busiest container ports are outperforming their Asian and European counterparts in global rankings when it comes to cargo volume. spike, according to shipping data provider Alphaliner.

In Europe, “durable goods consumption shows nothing like the boom happening in the United States,” says Fabio Panetta, who sits on the European Central Bank’s six-member executive board. know in a speech last month. Consumption of durable goods is up about 45% from 2018 levels in the US, but only about 2% in the euro area, according to ECB data.

Factory prices in China are much higher than consumer prices, signaling a gap between weak domestic demand and strong overseas demand, particularly due to America’s appetite for manufactured goods. of China.

While messed up global supply chain also play a role in driving global inflation, economists and central bankers are increasingly pointing to strong US demand as a root cause.

“Are we attracting consumers in other countries? Probably,” said Aneta Markowska, chief financial economist at Jefferies in New York. “American consumers have more purchasing power due to fiscal policy than consumers elsewhere. As a result, Europe could fall into stagflation next year.”

According to data from the Bank of England, the US has accounted for almost nine-tenths of the total 22 percentage points of demand for durable goods by major advanced economies since the end of 2019.

“Very strong US demand is definitely where [global supply bottlenecks] has begun,” said Lars Mikael Jensen, network head of the giant container shipping line

AP Moller-Maersk

AS.

“It’s like a queue on a highway. The increase in production in the US… takes ships away from other markets,” said Mr. Jensen. “Problems in one place cause problems elsewhere, we live in a global world.”

Analysts say the US economy is likely to grow about 6% in 2021 and 4% or more in 2022, the highest rate in decades. Follow

Deutsche Bank

analysts.

According to JPMorgan Chase, US economic output is likely to cross its pre-pandemic path early next year, while output in China and emerging markets will remain about 2% below that path. until 2023.

According to data from the Bank for International Settlements, a central bank based in Switzerland, US wages are growing by about 4% a year, well above the pre-crisis trend rate, compared with growth less than 1% growth in the euro area.

“We gave a lot of support on [the economy] and what’s going to happen now is really strong growth, really strong demand, high incomes and all that,” Federal Reserve Chairman Jerome Powell said after a recent meeting. of the central bank. “People will judge in 25 years whether we’ve overdosed.”

The Fed says it will quickly scale back its Covid-19 bond purchases and set the stage for series of rate hikes starting next spring.

In Europe, the ECB committed to continue buying bonds at least through October 2022, and said there is no chance of a rate hike next year. U.S. core inflation, measured annually for two years, rose above 3%, nearly double the level in the euro area, according to data adjusted for pandemic impact and changes in real prices. unstable products and energy.

“The strong post-pandemic recovery that was initially predicted by 2022 has yet to materialise,” said Timo Wollmershäuser, head of forecasting at the German research organization Ifo. The institute recently lowered its forecast for German growth in 2022 by 1.4 percentage points to 3.7%, citing ongoing supply bottlenecks and a new wave of Covid-19.

The Fed’s assertiveness is driving up the value of the US dollar and putting pressure on emerging market central banks to raise interest rates even before their economies recover or are at risk. currency devaluation and inflation.

Mexico’s central bank said on Wednesday it would raise its benchmark interest rate by 0.5 percentage points to 5.50% after inflation surged to a 20-year high of 7.4%.

Russia’s central bank said on Friday that it would raise the prime rate by 1 percentage point to 8.5%, and may increase the price again soon, after inflation hit a nearly six-year high of 8.4%.

Businesses are pouring money into the US, looking to capitalize on what some expect is a sustained increase in demand. In some cases, they are bringing manufacturing closer to American consumers, to avoid supply shocks related to the pandemic and global trade war.

The recent US fiscal stimulus “gives us more confidence in the US market. Marc Becker, Managing Director of Overseas at

Siemens Gamesa . Renewable Energy SA,

a wind turbine manufacturer based in Spain.

The company plans to invest more than $200 million to build offshore turbine blades in Virginia, the first commitment by a global manufacturer in the US-based supply chain.

According to JPMorgan Chase, equipment investment in the US is expected to grow 13% this year. The bank predicts that investment in the euro area will grow by 3.6% this year, while business investment in Japan will grow by 0.1%.

According to Oxford Economics, two new US fiscal spending packages worth $3 trillion could boost the US economy by 0.5 to 1 percentage point over the next two years. the future of bigger bills was suspected last weekend. Meanwhile, consumers continue to spend money from previous stimulus packages.

Meyer Burger Technology AG

, a Swiss solar module manufacturer, plans to build its first plant in the US by the end of next year, adding to existing production facilities in Germany. That signals a change for the solar industry, where about 80% of production is currently located in China.

Chief executive officer Gunter Erfurt said the decision was driven by rising shipping costs and fast-rising US demand. Logistics costs are up to four times higher than they were before the pandemic, he said.

“US customers see and feel that supply chains are shaky and they can no longer be trusted. Dr. Erfurt said.

According to Oxford Economics, foreign direct investment into the United States rebounded above expectations and was on par with foreign investment in China in the second quarter of 2021. According to the International Monetary Fund, the United States became a country was the world’s largest recipient of foreign direct investment in 2019 and strengthens that position in 2020, driven mainly by higher direct investments from Japan, Germany and the Netherlands.

“People in every industry are now testing whether it is smart to manufacture in China alone,” said Mr. Becker of Siemens Gamesa. Congested ports in China and rising transportation costs show the vulnerability of long supply chains, he said.

Write letter for Tom Fairless at tom.fairless@wsj.com