The University of Michigan Consumer Sentiment Index rose to 53.3 in December of 2025 from 51 in the previous month, which was the second-lowest result on record, coming ahead of market expectations of 52, according to a preliminary estimate. It was the first improvement in the headline index in five months, supported by improved expectations amid a 13% rise in expected personal finances, especially among younger consumers. Consistently, labor market expectations improved slightly but remained aggressively pessimistic on a historical standard. Meanwhile, year-ahead inflation expectations fell to 4.1% from 4.5%, the least since January, as consumers noted that concerns of tariff-related surges in prices have not come to fruition. Likewise, five-year inflation expectations softened to 3.2% from 3.4%. Still, uncertainty remained on the outlook of prices, as elevated variances on the survey's response remained higher than those of January this year. source: University of Michigan