The virus situation continues to improve with COVID cases beginning to decline, mortalities remaining at low levels and growth in hospital admissions flattening. In the week ending June 20, there was a daily average of 82.6k cases, a 19% decline from the prior week.1 This decline may be partially due to delayed reporting, however, other data on the virus also suggest there is limited economic risk. Indeed, mortalities have not increased during the latest virus wave and new hospital admissions should peak soon.
Consumer spending data continue to point to strong aggregate spending, partially due to elevated spending on gasoline. Both Redbook same store sales and Bureau of Economic Analysis (BEA) card transaction data continue to record double digit growth rates. The BEA data also point to moderating spending on furniture, electronics and clothing. There were mixed signals on demand for leisure services. On the one hand, air passenger throughput and hotel occupancy levels were below 2019 levels in the latest data. On the other hand, seated diners on the OpenTable network were 7.5% above 2019 levels in the week ending June 20, and movie box office receipts were boosted by two large movie releases.2,3