Using a back-of-the-envelope calculation, we estimate that the sharp rebound in equities last year contributed to an increase of roughly $900 billion in households' stock wealth, or $288 billion in consumer spending.

Sales of new homes grew 1.5% in January, much slower than the 7.2% increase in December, most likely because of elevated mortgage rates.

New claims fell by 12,000 to 201,000 for the week ending Feb. 17, according to the Labor Department's data on Thursday.

Just as inflation appeared to be coming under control in recent months, rising tensions in the Middle East have shaken this view and now represent the major risk to our economic and inflation outlooks.

We expect the Fed to begin cutting rates in June, and that the central bank will reduce its policy rate four times this year, by 25 basis points each.

The overall index eased to 0.9% in the fourth quarter on a seasonally adjusted basis, down from 1.1% in the previous quarter.