There is heightened optimism the Federal Reserve will cut interest rates next month, with hopes boosted by a better-than-expected inflation report and Wall Street’s fear gauge falling to its lowest level this year, as the S&P 500 and Nasdaq jumped to new record highs Wednesday.

The U.S. stock market rallied to records after data suggested inflation across the country was a touch better last month than economists expected.

Shares have advanced in Asia after the U.S. stock market rallied to records when data showed inflation across the United States improved slightly last month.