Investors ignored the data from last week believing it is too soon to determine the base level of economic activity post pandemic.

The Advance Report for second quarter economic growth was released last week. Real GDP was reported as having increased by 6.5% over first quarter levels. The consensus forecast called for an increase of 8% causing the results to be considered as disappointing. The internals in the report were anything but disappointing. Personal consumption expenditures grew by 11.8% or slightly faster than the first quarter. The composition of this growth was much different than the first quarter. Service sector consumption grew by 3.9% in the first quarter and surged by 12.1% in the second quarter as restaurants and travel opened. Goods spending growth slowed from 27.4% in the first quarter to 11.6 % in the second as supply chain disruptions limited the availability of goods.