United States consumer sentiment rose slightly to 52.9 in December, though it remains well below 2024’s levels amid high prices and inflation concerns.
The consumer sentiment index was up 3.7% from the previous month, according to the University of Michigan Surveys of Consumers. This is 28.5% lower than in December 2024, however.
“Consumer sentiment confirmed its early month reading, inching up less than two index points from November, within the margin of error,” said Surveys of Consumers director Joanne Hsu.
December’s preliminary reading, released earlier in the month, was 53.3. Economists had projected an index of 52, according to Reuters polls.
Buying conditions for durable goods dropped by 6%, their fifth consecutive month of decreases, and are more than 40% under their levels in December 2024.
“The escalation of tariffs in this past spring spurred fears of catastrophic inflation among consumers,” said Hsu. “While those fears abated as tariff policy have since eased, consumers are still expecting inflation to remain elevated for the foreseeable future, thus diluting the potential purchasing power of their budgets.”
Consumer sentiment was lowest among Democrats, at 35.5, though this increased from 32.4 in November. Republican sentiment also ticked up from 86.6 in November to 87.9 in December.
The current economic conditions index dipped by 1.4% from November, reaching 50.4. The survey found 47% of consumers reporting high prices are impacting their personal finances, similar to November and up 35% year-over-year.
The index of consumer expectations rose to 54.6 from 51.0 in November, but this is 25.5% lower than one year ago.
Inflation unexpectedly eased in November, the Bureau of Labor Statistics found, though this was likely impacted by the 43-day government shutdown. Prices were up 2.7% that month, compared to 3% in September.
Around 63% of respondents expect unemployment rates to worsen in 2026. Unemployment increased by 3.6% in November, per the Bureau of Labor Statistics, which is the highest level since 2021.
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