U.S. stocks were given a boost today by a strong upward revision of GDP growth data for Q2. According to updated figures, between April and June, the economy expanded by 3.3% y-o-y, up from a preliminary estimate of 1.9%. The Dow (DJI), S&P500 (INX) and Nasdaq (IXIC) all responded with gains of over 1% during the day’s trading.

The Daily Reckoning’s Chuck Butler has a less positive interpretation of the growth data, which he says is a blip on the downward path to recession. First, here are some more details from Forbes.com:

“The second quarter revision was well above the 2.7% average prediction from economists polled by Thomson Financial.

The faster-than-expected growth came off the back of rising exports, which were helped by the weak U.S. dollar, falling imports, more consumer spending and less inventory reduction than initially reported, the Commerce Department said.

“The increase in real GDP in the second quarter primarily reflected positive contributions from exports, personal consumption expenditures (PCE), federal government spending, nonresidential structures, and state and local government spending,” the department said in its report. Commerce also noted that imports, which subtract from GDP, were revised lower.”

Chuck wasn’t surprised by the elevated reading. A plunging dollar and the government’s stimulus checks are behind the upward revision. And neither will apply to data for Q3…

“Front and Center this morning I have to talk about the blip that we’re going to see that happened in the 2nd QTR due to the stimulus checks. It all goes back to the stimulus checks and the first sign of this came (besides Retail Sales) yesterday in the form of Industrial Production. Remember yesterday when I told you that Industrial Production is a second tier piece of data that gets ignored by the markets, but I think it’s important so I talk about it? Well… Just like last week, when I described the bratty spoiled child throwing a tantrum on the floor of the grocery store as being something you can’t avoid paying attention to… The growth in Industrial Production was the same…

Industrial Production for July came in strong, and rose 1.3% in the month and compared to expectations of a no change. The June increase was revised up to 1.3% from an initially estimated gain of 0.8%. And… The good news about this data is that the growth was led by non-defense spending! WOW! When was the last time that happened? Anyway…. The stimulus checks have their fingerprints all over this report…

And so too will they have their fingerprints all over the 2nd QTR print of GDP today. I told you Monday that to expect a blip up in GDP, which will stir the interest rate hike pot once again, and probably give the dollar some love. One thing to think about here, because the dolts in the media won’t even think about it, they’ll just drool all over the size of the GDP growth, is that I expect exports to have contributed to the 2nd QTR GDP by a sizeable margin, for what was happening to the dollar in the 2nd QTR? It was getting sold like funnel cakes at a State Fair, and getting weaker, and weaker, which just made exports look cheaper and cheaper, thus giving them a huge boost.

But what’s happened since the end of the 2nd QTR? The dollar has rallied, so don’t look for that boost to GDP in the 3rd QTR… And don’t look for the boost to GDP in the 3rd QTR from the stimulus checks… Those have already been spent! So… The 2nd QTR is going to end up being a blip on the recession chart when the historians look back on this period of time. But… That means, dollar strength, folks… Because, even though the markets normally are “forward looking” they will get so caught up in this 2nd QTR GDP growth that they will lose their focus.”

To read more of Chuck’s currency analysis today, click here.