Wall Street was set for a marginally higher open on Friday after data underscored the narrative that price pressures were cooling, raising expectations that the Federal Reserve's next move might be another outsized interest rate cut.

Data that show dropping inflation and sustained economic growth kept investors in a positive state of mind after last week’s interest rate cut.

Premarket trading on Wall Street was relatively listless Friday ahead of the government’s latest inflation report. Futures for the S&P 500 and the Dow Jones Industrial Average were essentially unchanged less than two hours before the opening bell,

Wall Street is poised for a modest rise following encouraging inflation data, which showed the U.S. personal consumption expenditure index rose by 2.2% annually. This has raised expectations for a potential interest rate cut by the Federal Reserve.

U.S. main stock indexes inched up on Friday and small-cap stocks outperformed after a benign inflation report cleared the way for the Federal Reserve to focus on shoring up the labor market while continuing its interest rate easing.

Stock indexes opened higher on Wall Street on Friday, with the S&P 500 nearing record highs. This rise follows soft inflation data, which has led to expectations that the Federal Reserve will now focus on strengthening the labor market and continue to ease interest rates.