He listed the current lack of inventory of homes for sale and the ongoing “supply chain bottlenecks” experienced by homebuilders as the primary constraints on home purchase activity.

Palim said the recent surge of COVID-19 cases due to the Delta variant appeared to be “affecting consumer behavior”, warning that the economic response so far had been “modest compared to last year’s outbreak”.

COVID remained a major concern, he said. “It’s nowhere near what we saw last year, and so far cases are definitely more regionalized, but we’re definitely watching it.”

Another unknown factor that could impact on the economy is whether consumers would feel confident enough to begin spending the more than $2 trillion of government stimulus payments from last year.

“We just don’t know how much of that money they are going to spend, so that is a particularly large uncertainty on the forecast,” he added.