U.S. economy shows signs of turning the corner

Are we there yet?

The U.S. economy has been slouching toward recovery for four-and-a-half years now, with each setback along the way causing a collective flinch. Contagion in the eurozone. City-swamping hurricanes. Fiscal cliffs. Government shutdowns, along with self-inflicted gunshot wounds like the sequester.

Each new dawn has proved as false as the last, except to seemingly confirm what the dismal scientists (otherwise known as economists) have been telling us: It could take a decade or more for the economy to resemble its old self. The latest scare came earlier this month, when federal data showed December job growth suddenly going as cold as the polar vortex. 

Yet something odd happened toward the end of last year that economic forecasters weren't expecting: Things started looking up. Lawmakers in Washington called a truce, if only to strike a pose for this year's midterms, and actually made laws. Consumers kept spending. Rather than slowing down over the last three months of the year, as many had predicted, the economy sped up.

Factories also revved up their assembly lines, a sign that the sluggish demand shackling the economy is starting to ease. After bottoming out in the second quarter of 2013, manufacturing activity has surged and is now expected to help drive job-creation this year, notes economist Lindsay Piegza of brokerage firm Sterne Agee. 

The all-important question, of course, is whether this momentum will last. Maybe not all of it -- growth of around 2.5 percent for the year is more likely, according to economists. Meanwhile, a moderately upbeat forecast may be cold comfort to the millions of Americans who remain unemployed and who face a cut in jobless benefits.

Still, the economy seems finally to have found its footing. We're still a ways from home, but at least the terrain looks familiar.

Here's what's coming up this week.

Wednesday, Jan. 22
- Mortgage Bankers Association index

Thursday, Jan. 23
- Existing home sales (Nat'l Association of Realtors)
- Weekly jobless claims (U.S. Labor Department)
- Federal Housing Finance Agency Housing Price Index