The economy surged at a 6.4% rate in the first quarter. Consumers drove those gains supported by a ramp up in vaccinations, supplements to unemployment insurance and two rounds of stimulus checks. Spending on big ticket goods - vehicles, furniture, appliances - fueled gains.

Spending on services also picked up slightly as the pent up demand to travel by older people getting vaccines was tapped. Low-wage households were able to replenish their parties with food, which had gone bare by late 2020. Spending at fast food establishments also jumped.

Residential investment posted its third consecutive quarter of double-digit gains as home owners and buyers continued to remodel and build new homes in response record low mortgage rates. They sought space to accommodate the shift to work-from-home.

Business investment slowed a bit but continued to post solid gains. Spending on information technology drove those increases. Rapid adoption of existing technologies is boosting productivity in both the goods and service sector. It is also eliminating some high contact jobs.

Commercial real estate contracted for the sixth consecutive quarter. It was one of the few sectors (along w manufacturing) which was weak prior to the onset of the crisis. The exception is warehouses to accommodate the shift to online shopping.

Inventories were drained in response to strong consumer spending & delays triggered by the Ever Given, the ship that got stuck in Suez Canal. The replenishing of those inventories will provide a tailwind for the spring & summer. The economy is going to get even stronger.

The trade deficit widened as exports fell. A surge in infections abroad amidst a slow ramp up in vaccinations prompted additional lockdowns. Gains in federal spending overshadowed a modest rebound in spending at the state & local level. A light at the end of a long tunnel.