U.S. Corporate Profits Soar In The Second Quarter; Economic Growth Raised

• U.S. corporate profits surged to a fresh record high in the second quarter, boosted by robust demand and higher prices, suggesting that an anticipated slowdown in economic growth this quarter because of soaring COVID-19 cases could be temporary.
• The jump in profits reported by the Commerce Department on Thursday was despite businesses facing increased costs owing to shortages of raw materials and labour. The resurgence in infections driven by the Delta variant of the coronavirus is chipping away demand for services like air travel and cruises, leading economists to cut their third-quarter growth estimates.
• “Based on the profits data, any slowdown in growth as a result of slower consumer spending is likely to prove temporary,” said Conrad DeQuadros, senior economic advisor at Brean Capital in New York.

(Source: Reuters)