A Labor Department report showed the consumer price index rose 0.2 per cent in November, following a 0.2 per cent decline in September. Consumer prices excluding food and fuel rose 0.2 per cent in October, the same as in September.
US Treasuries fell. The data underpinned expectations the Fed will lift rates next month for the first time since 2009.
"The last thing the Fed wanted to see is a downturn in inflation and this is significant for them," Jim McDonald, the chief investment strategist at Chicago-based Northern Trust, told Bloomberg.
A separate report showed that while US industrial output fell last month, manufacturing production climbed the most since July.
"There is nothing that derails a December Fed rate hike in today's data," Thomas Costerg, an economist at Standard Chartered Bank in New York, told Reuters. "Inflation is starting to turn a corner and manufacturing production remains resilient."
Indeed, the strength of the US dollar weighed on commodities including copper which touched the lowest level since May 2009.
"The copper market has been one of the worst markets I've ever seen, copper demand is basically non-existent right now, and all this started when there was a downturn in the Chinese stock market this summer," Phil Streible, a senior market strategist at RJO Futures in Chicago, told Bloomberg. "Copper prices are going to continue to travel down to historical levels."
Investors will eye the minutes from the Fed's October meeting, slated for release on Wednesday.
In Europe, the Stoxx 600 Index ended the session with a 2.5 per cent jump from the previous close. The UK's FTSE 100 Index increased 2 per cent, Germany's DAX Index gained 2.4 per cent, while France's CAC 40 Index rallied 2.8 per cent.
In Germany, a report showed economic sentiment rose more than expected this month. The ZEW Centre for European Economic Research said its index of investor and analyst expectations jumped to 10.4 in November, up from 1.9 the previous month. It was the first gain in eight months, and included results received after the assaults in Paris.