US Consumer Sentiment Rises for First Time in Five Months
US consumer sentiment rose for the first time in five months, bolstered by a more optimistic outlook for personal finances as inflation expectations improved.
The preliminary December sentiment index rose to 53.3 from 51 a month earlier, according to the University of Michigan. The survey period includes responses from Nov. 18 to Dec. 1. The median estimate in a Bloomberg survey of economists called for a reading of 52.
Consumers expect prices to rise at an annual rate of 4.1% over the next year, down from a month earlier and the lowest since January, the report issued Friday showed. And they saw costs rising at an annual rate of 3.2% over the next five to 10 years.
Still, consumers remain troubled by a stubbornly high cost of living, which has been a major drag on sentiment this year.
“Consumers have noted that the soaring inflation they feared in April and May 2025 at the height of tariff developments has not come to fruition at this time,” Joanne Hsu, director of the survey, said in a statement. “Still, inflation expectations over both time horizons remain higher than average readings from both 2024 and 2020.”
At the same time, holiday shopping data show consumer demand is resilient. Sales on Black Friday, excluding auto dealers, increased 4.1% from a year earlier, according to data from Mastercard SpendingPulse. That surpassed last year’s 3.4% growth.
While the increase in sentiment was led by younger consumers, a 13% rise in personal financial expectations was broader. A measure of the outlook for finances climbed to the highest level since February.
Views about the job market improved slightly this month, though a majority of respondents still expect unemployment to rise in the coming year. It has become more difficult for unemployed Americans to find a new job and there has been a spike in high-profile layoff announcements from large companies.
A Harris Poll conducted for Bloomberg News in October showed that 55% of employed Americans were concerned about losing their jobs. And almost half said they believe it would take them four months or longer to find a new job of similar quality if they lost their current position.
The expectations index rose to a four-month high of 55 from 51 in November, while the current conditions gauge fell to a fresh record low.
Source : Bloomberg.com
