All three main indexes on Wall Street rallied Friday -- with Apple ending above the $3 trillion capitalisation mark for the first time -- on the report, setting up a positive start to the week for Asian investors.
News that the personal consumption expenditures (PCE) index -- the Federal Reserve's favoured gauge -- had dropped sharply provided some relief for traders after a series of forecast-beating indicators suggested the economy remained in rude health.
A strong read on economic growth and a fall in jobless claims had fanned expectations the Fed would have to keep hiking borrowing costs in order to get a grip on prices.
The PCE figure came along with news that eurozone inflation had also eased, thanks to a drop in energy costs.
The S&P 500 and Nasdaq chalked up big gains to end a strong first half of the year, even after a series of rate hikes as well as a regional banking crisis.
Among the best performers were tech firms, and Friday's close saw Apple become the first firm to end above $3 trillion market capitalisation.
"Markets are already pricing in further rate hikes this month from the Federal Reserve, as well as the ECB, followed by the Bank of England in August," said CMC Markets analyst Michael Hewson.
"The bigger question is what comes after these. One suspects we may not see many more after these hikes."
The strong performance in New York filtered through to Asia, where tech was also a big winner.
Hong Kong jumped more than two percent while Tokyo, Shanghai, Seoul and Taipei were each up at least one percent.
There were also healthy advances in Sydney, Singapore, Mumbai, Jakarta, Bangkok and Manila.
Tokyo was also boosted after news that the Bank of Japan's closely watched Tankan survey of confidence among the country's largest manufacturers rose for the first time in seven quarters.
London, Paris and Frankfurt were also well in the green.
However, analysts warned that the PCE figure was welcomed on trading floors but Fed officials would not likely be swayed by one reading, and the bank is tipped to resume hiking this month after pausing in June.
"Whilst the data is seemingly travelling in the right direction (lower inflation), it is too soon for the Fed to ring the bell and claim a job well done," said National Australia Bank's Rodrigo Catril.
This week sees the release of US jobs creation as well as a visit to China by US Treasury Secretary Janet Yellen.
She is expected to talk about the importance for both sides "to responsibly manage our relationship, communicate directly about areas of concern, and work together to address global challenges", the Treasury Department said.
The July 6-9 trip comes just weeks after Secretary of State Antony Blinken met China's top leader President Xi Jinping and Foreign Minister Qin Gang in Beijing in June.
- Key figures around 0810 GMT -
Tokyo - Nikkei 225: UP 1.7 percent at 33,753.33 (close)
Hong Kong - Hang Seng Index: UP 2.1 percent at 19,306.59 (close)
Shanghai - Composite: UP 1.3 percent at 3,243.97 (close)
London - FTSE 100: UP 0.2 percent at 7,547.71
Euro/dollar: DOWN at $1.0879 from $1.0912 on Friday
Pound/dollar: DOWN at $1.2671 from $1.2696
Euro/pound: DOWN at 85.87 pence from 85.92 pence
Dollar/yen: UP at 144.75 yen from 144.33 yen
West Texas Intermediate: DOWN 0.1 percent at $70.59 per barrel
Brent North Sea crude: FLAT at $75.41 per barrel
New York - Dow: UP 0.8 percent at 34,407.60 (close)
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