With the headline consumer price index (CPI) rate at a 13-year high in the US, it is not surprising that companies are talking more about inflation.

It’s not just business surveys that show us this. You can also see it by looking at the transcripts of what the management teams of publicly-listed companies have talked about during earning calls.

Of course, it would be a painstaking exercise to manually go through thousands of earnings transcripts each month. This is where natural language processing (NLP) analysis comes in. NLP uses the power of computers to get insights from the text of written documentation. In simple terms, you can track the number of mentions of words and phases that appear in the transcripts.

Working with the experts in our Data Insights Unit (DIU), we find that there has been an unprecedented amount of inflation talk among US companies recently compared to the past. Meanwhile, corporate management teams appear to be more concerned about inflation than wages. Regarding supply chains, mentions of bottlenecks and disruptions have jumped because of the Covid pandemic.

Inflation talk among US companies has surged

Looking back over the last 15 years, US companies are certainly talking more now about inflation than they have ever done before. Chart 1 shows the number of mentions in the earnings transcripts of the word “inflation” accompanied by any of the words “rise”, “increase”, “higher” or “pressure”.

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