Armed with consumer and wholesale inflation reports, Wall Street economists predict the Federal Reserve’s favorite price gauge will show just a mild increase in November and justify an interest-rate cut.

The Federal Open Market Committee started cutting interest rates in September and that process looks set to continue.

While the Federal Reserve is expected to cut its key interest rate next week, stubborn inflation could pressure the central bank to keep rate cuts few and far between next year.

Average mortgage rates surged to around 7% last month, but they've dropped recently, with markets betting that the Federal Reserve will reduce the federal funds rate on Dec. 18.

Consumer inflation accelerated in November to 2.7% from 2.6% and core CPI was sticky at 3.3%. But a December Fed rate cut still looks like a sure thing.

Inflation in November rose modestly, with housing costs continuing to be a major factor in price increases. However, the Fed is expected to proceed with an interest rate cut next week.

Most stock markets in the Gulf ended higher on Thursday, in step with a global equity rally after U.S. consumer inflation data cemented bets of a Federal Reserve interest-rate cut next week.

Inflation is moving in the wrong direction. U.S. inflation picked up for a second straight month in November on a rise in food and gasoline prices, underscoring that the final stretch of the Federal Reserve's two-year battle against sharply rising prices has become more challenging.

New data from the Labor Department shows the consumer price index, a key inflation gauge, rose 0.3% in November. That will likely impact the Federal Reserve's final interest rate decision of 2024. CBS News MoneyWatch correspondent Kelly O'Grady has more.