The Fed kept policy rates unchanged at this week's meeting and announced a faster reduction of its bond buying program, to finish in March.

The Fed is expected to fight inflation by beginning to raise policy rates after concluding the bond buying program early next year.

Wholesale prices rose 9.6% from a year ago, the highest level since November 2010. The pace was faster than the 9.3% estimate.

Strong demand buoyed homebuilder confidence, which ended the year healthy despite rising costs and labor shortages.

November housing starts rose more than expected to an 8-month high. Builders are making headway on backlogs even with challenges.

Homeowners are sitting on a record amount of home equity due to soaring demand and skyrocketing prices over the last year and a half.