A worker builds a Ford Expedition SUV as it goes through the assembly line at the Ford Kentucky Truck Plant in Louisville, Kentucky.

The economy may have cooled in the first quarter, as it does every year, but the markets are watching to see if wages heated up.

Economists expect to see 2 percent growth in the first quarter, down from 2.9 percent in the final quarter of 2017, when GDP data is released at 8:30 a.m. ET Friday. Employment costs for the first quarter are expected to rise 0.7 percent, compared with a 0.6 percent gain in the fourth quarter, according to Thomson Reuters.

Traders are watching for any numbers that could signal the Fed that the inflation picture is heating up ahead of its meeting next week. It's not expected to move on rates or release new projections, but it will have a post-meeting statement. The Fed is expected to raise rates in June and issue new forecasts on the economy and interest rates.

Stocks surged Thursday with the Dow closing 238 points higher at 24,322, driven by earnings. The S&P 500 gained 1.1 percent to close at 2,666, and the Nasdaq was up 1.6 percent to 7,118.

Bond yields retreated, with the 10-year mostly hovering just below 3 percent.