On Thursday, US Commerce Department data had revealed that US corporate profits had skyrocketed to a fresh record over second quarter, mostly buoyed up by a strong demand coupled with higher prices, illustrating that an ostensible calm-down in business activities in current quarter in context of a sharp rise in delta cases would highly likely to be short-lived.
As a matter of fact, in the day’s US Commerce Department report that had reported a record corporate profit surge over Q2, 2021, came against the backdrop of a steep build-up in price pressures due to a sweeping shortage of raw materials, while an insurgence in pandemic cases threatening global economic recovery had led to analysts’ belief that a strong uproar in US business activities following a robust reopening of the economy would cool down in the latest quarter.
Meanwhile, citing prospects of a near-term ease in slowdown in economic growth, a senior economic advisor at Brean Capital in New York, Conrad DeQuadros said, “Based on the profits data, any slowdown in growth as a result of slower consumer spending is likely to prove temporary”.
US corporate profits surge to record in second quarter
Apart from that, according to US Commerce Department data, US corporate profits from current productions soared 9.2 per cent to $234.5 billion in Q2, 2021, compared to a quarter earlier, however, profits from current production grew at a pace of 5.1 per cent over first quarter of the year.
Besides, pre-tax profits rose 0.7 percentage point to 12.3 per cent, marking up the highest readout since 2014, while national after-tax profits grew by 12.8 per cent or $303.6 billion over second quarter of 2021, well above a 9.4 per cent growth clocked over the first quarter.
On top of that, according to latest set of data, US GDP (Gross Domestic Product) has been now hovering at 0.8 per cent higher from a peak reached on Q4, 2019. Nonetheless, other economic data released on Thursday had revealed that US weekly jobless claims rose marginally by 4,000 to a seasonally adjusted 353,000 last week.