Source: Cai Lian She Author: Liu Rui
The seemingly inconspicuous cardboard box is actually a barometer of the overall macroeconomic health. Bank of America recently stated that as the prices of the US packaging industry are about to rebound, it marks a potential end to the 'cardboard box recession' crisis in the US.
Many people may not imagine that the seemingly inconspicuous cardboard box is actually a barometer of the entire macroeconomic health in the US.
Cardboard boxes are an important part of the supply chain. They are needed for e-commerce transactions or shipments to stores. Therefore, the demand and price data of cardboard boxes have been used by many economists to determine the overall macroeconomic health. Bank of America recently stated that as the prices of cardboard boxes in the US are about to rebound, it marks a potential end to the 'cardboard box recession' crisis in the US.
Bank of America recently stated that as the prices of cardboard boxes in the US are about to rebound, it marks a potential end to the 'cardboard box recession' crisis in the US.
The price of cardboard boxes in the US will finally rise.
Since the second half of 2022, the price of cardboard boxes in the US has been continuously declining, which has also caused US economists to worry that this may be a signal indicating a recession in the US economy.
However, the latest survey by Bank of America shows that in the next few quarters, the price of cardboard boxes in the US may increase significantly, which is clearly a positive signal for the overall US economy.
George Staphos, a research analyst from Bank of America, stated that 'based on our surveys of multiple independent cardboard box manufacturers, we have raised our expected growth rate in cardboard box prices from 0.6% to over 3%. In my opinion, this is very important... In addition, respondents generally conveyed to us a strong feeling that cardboard box prices will continue to rise.'
Although he admitted that the growth in the price of cardboard boxes in the US is largely due to inflation, the Bank of America survey shows that demand expectations are also playing a role.
The report stated that in the next 6 to 12 months, 62% of respondents believe that the demand for cardboard boxes will be 'better' or 'much better'. By comparison, only 39% of people thought so in April of this year.
Is the US about to exit the 'cardboard box recession' crisis?
The recovery in cardboard box demand is obviously good news for the overall US economy, because it eliminates at least one recession indicator.
In the past two years, despite high inflation in the US, demand for cardboard boxes has been low. Especially last year, US demand for cardboard boxes fell to a new low since 2009, and many analysts were worried that this meant a significant decline in US consumer spending.
Last June, Charles Schwab claimed that the US had entered a 'cardboard box recession' period and warned that this would affect all aspects from the labor market to the stock market.
The definition of 'cardboard box recession' is the continuous shrinkage of market demand for cardboard boxes over several quarters. Looking back at the recent economic recession in the US, the phenomenon of 'cardboard box recession' has almost appeared every time before the economy enters a recession.
However, since the second half of last year, economic data and market trends in the US have unexpectedly gone up. In recent months, US consumer spending has remained resilient, which has also pushed the US stock market to new record highs.
Against this background, the demand for cardboard boxes has also rebounded, which will further enhance economists' confidence in the US economy.
Editor/Lambor