US stocks were on pace for record closes as Wall Street's attention turned from an upbeat day marked by renewed AI fervor to the next tranche of critical economic data.

Urban American consumers are paying more for good and services while more are out of work, according to the U.S. Bureau of Labor Statistics.

With August data for both the CPI and the producer price index proving fairly soft for August, economists expect the Fed’s preferred inflation gauge to remain unchanged at the next reading. Economists for Citi expect that the core personal consumption expenditures price index will increase 0.

Underlying US inflation rose as expected in August, keeping the Federal Reserve on track to cut interest rates next week.

The Consumer Price Index rose 0.4% M/M in August, topping the +0.3% consensus and accelerating from +0.2% in July, according to data released by the Bureau of Labor Statistics on Thursday.

The latest PPI report showed inflation is largely a non-issue at the moment, but today's CPI report could impact Federal Reserve rate cut decisions and stock market trends. Stocks largely got a boost yesterday from Oracle's earnings report,

CPI rose 0.4% month-over-month (MoM) in August, against the expected 0.3%. In August, Core CPI rose 3.1% YoY as per expectations. The figure rose 0.3% MoM as expected. The CPI data is the most common metric to measure inflation.

The cost of living rose again in August at an accelerated pace, but probably not enough to discourage the Federal Reserve from reducing interest rates next week. The latest consumer price index could raise questions about how aggressively the Fed cuts rates,

Measuring inflation takes resources, but both the public and the U.S. government itself benefit from having an accurate read on price changes.

The major U.S. stock indexes closed at fresh record highs on Thursday after consumer inflation data came in as expected, adding to Wall Street's conviction that the Federal Reserve will resume rate cuts next week.