Economists upbeat about growth this year: NABE

The U.S. economy looks as if it's headed for another good year, according to the latest forecast from a group of business economists.

In its latest survey, the consensus of the National Association for Business Economics panelists peg the growth of gross domestic product (GDP) at 3.1 percent this year—easing to a 2.9 percent annual pace next year. That compares with GDP growth of 2.4 percent last year.

"Healthier consumer spending, housing investment, and government spending growth are expected to make outsized contributions to the projected acceleration," NABE President John Silvia, chief economist of Wells Fargo.

That will help keep the job market humming—with payrolls expanding by about 250,000 new positions a month this year and roughly 216,000 next year. That should drop the jobless rate to 5 percent by the second half of 2016, according to the consensus estimate from the group.

With the dollar surging and oil prices plunging, inflation is expected to remain below 1 percent, as measured by the consumer price index. But the group expects prices to begin rising at a quicker pace next year, as oil prices rebound and dollar's appreciation cools off.

The economists expect crude prices to recover a but this year—rising to $61 a barrel, based on the West Texas benchmark year-end projection—before edging up to $69 a barrel by the end of next year.

Lower gasoline prices are expected to boost consumers spending to a 3.3 percent rate this year.

The panel also expects strong growth in housing, business investment and industrial production to support the overall pick up in economic expansion this year

The group is less upbeat about the growth in hourly wages, which are expected to rise by 2.5 percent this year—a bit less than the 2.6 percent gain expected in December's survey. Wages are seen rising by 2.9 percent year, up from last year's hourly pay growth of 2.5 percent.

However, the panel sharply scaled back its forecast for corporate profits, an area Wall Street is growing extremely nervous about as the U.S. dollar surges. The latest survey sees profits growing just 4.7 percent this year, down from December's 6.7 percent forecast. Profits are expected to rise by 4.9 percent next year.

Read MoreWhy the jobs report could decide the dollar's fate

Waiting on the Fed

Slower profit growth also means stock price gains will be modest, according to the latest survey, which predicts the S&P 500 Index will end the year 2,150, lower than the 2,167 level forecast in the December survey. That would represent a gain of just 4.4 percent for 2015. The index is expected to post a 5.2 percent gain in 2016, closing out the year at 2,262.

Given the economic cross currents, the group expects the Federal Reserve to begin raising interest rates later this year. About half the group thinks the Fed will make its move in the third quarter, with the benchmark federal funds rate ending the year at three-quarters of a percent.

Read MoreThis theory has Janet Yellen worried

Tighter money policy will push the benchmark rate up to 2 percent by the end of next year, according to the NABE panel. Those forecasts are in line with recent comments from members of the Federal Open Market Committee.

By CNBC's John Schoen. Follow him on Twitter @johnwschoen or email him.