Corporations scramble to interpret signs of overheating US economy

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The speed of the US rebound from the Covid-19 crisis has left executives, investors and economists scrambling to interpret whether labour shortages and rising prices point to a short-term economic summer heatwave or a longer period of dangerous inflation.

Some of the country’s largest companies have hailed the strength of the recovery in recent earnings announcements while declining to predict whether the swift vaccination rollout and massive fiscal stimulus will cause problems for corporate America.

“The second half will likely have more uncertainty than a normal year,” Doug McMillon, chief executive of Walmart, cautioned this week, even as he and his contemporaries noted the strength of consumer spending and the prospect that elevated savings rates indicated continuing pent-up demand.

3M, the manufacturer, was among an array of companies highlighting “tremendous inflation” in the costs of labour, freight and some raw…

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