All signs points toward steady growth in 2014, as record equity rallies and strong job growth continue to lead a recovery in housing and consumer spending, chief economists from Moody's and UBS said on Tuesday.
UBS' U.S. economist Kevin Cummings said personal spending and consumption levels in the fourth quarter of 2013 could end up better than expected after solid growth in October and November
"You're already starting to see GDP growth," Cumming said on "Squawk Box." "You're already starting to see better data, and it's all because of the labor market. When the labor market starts to pick up we're going to start to see better consumer data."
Moody's Capital Market's Chief Economist John Lonski said the U.S. Federal Reserve's decision to taper its asset purchases by $10 billion last week appeared priced into the financial markets. He said the year-to-date market value of common stock is more than $4 trillion, attributing it to "one heck of a wealth effect." He also expects investment spending and personal income to rebound as well.
Lonksi said 10-year Treasury bond yields may hit 3.25 percent earlier than expected, and that would cause housing activity to slow down until yields returned to today's ranges.
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"We still have some pent up demand there among consumers for housing and automobiles," Lonksi said. "That still has to be exhausted. I think we'll do better on that front."
Cummings forecasts 3 percent year-over-year GDP growth in the fourth quarter of 2014, while Lonksi stands at 2.6 percent GDP growth next year.
— By CNBC's Jeff Morganteen. Follow him on Twitter at @jmorganteen.