WASHINGTON – U.S. consumer sentiment showed a modest uptick this month as concerns about inflation eased slightly, though overall confidence remains low. The University of Michigan’s preliminary consumer sentiment index climbed to 53.3 in early December, up from 51 in November and slightly higher than economists’ expectation of 52. Despite the improvement, the index sits far below January’s reading of 71.7, reflecting a continued sense of unease among consumers. While views of current economic conditions slipped, expectations for the year ahead brightened somewhat, signaling that households may be cautiously hoping for stability.
The survey also found that expectations for year-ahead inflation declined to 4.1%, down from 4.5% last month and marking the lowest level since January, when President Donald Trump returned to office and began imposing broad tariffs on imported goods. Economists note that these costs typically hit importers first and later filter down to consumers through higher prices. Although Trump has since negotiated agreements with major trading partners such as the European Union and Japan to moderate tariff levels, the overall U.S. tariff rate has risen sharply—from 2.4% in January to 16.8% last month, the highest since 1935, according to the Budget Lab at Yale University. Joanne Hsu, who oversees the Michigan surveys, said consumers remain weighed down by persistently high prices. Even with inflation easing from its mid-2022 peak, it continues to hover above the Federal Reserve’s 2% target, keeping pressure on household budgets.