US consumer sentiment improved in December, with the University of Michigan headline index rising to 53.3 from 51.0, beating expectations of 52.0. The gain was driven by a sharp rise in Expectations Index, which climbed to 55.0 from 51.0. However, views on current conditions deteriorated slightly from 51.1 to 50.7.
A key development came from inflation expectations. Year-ahead inflation expectations fell for a fourth consecutive month, dropping from 4.5% to 4.1%, the lowest since January 2025—though still above the 3.3% level seen at the start of the year. Long-run inflation expectations edged down from 3.4% to 3.2%, matching the January reading.
