U.S. stocks rose on Friday after a tame inflation report reinforced expectations that the Federal Reserve will cut interest rates at its final meeting of the year next week.

The Federal Reserve is due to make another decision on cutting interest rates.

Here's what could happen to inflation in 2026.

Follow for live news and analysis of the Fed's preferred inflation gauge, the personal consumption expenditures price index. The September reading is due to be released on Friday morning.

Americans seemed a tad more cheery about the economy this month, while a delayed inflation report came in better than expected.

Stocks are back on the doorstep of record territory after a volatile month on Wall Street, but persistent inflation worries and souring consumer sentiment are keeping investors uneasy ahead of the Fed’s last policy meeting of the year.

Fed officials should be able to focus on the wavering labor market and cut interest rates by another quarter percentage point at their final meeting of the year next week, thanks to relatively stable inflation data.

Inflation risks in the euro area are slightly tilted to the downside in the medium term, European Central Bank Governing Council member Olli Rehn said in an interview with Milano Finanza.

The latest inflation data release, September's Personal Consumption Expenditures (PCE) data, showed prices rose in line with expectations. This report will be the US federal government's final data release before the Federal Reserve's last FOMC meeting of the year,