The University of Michigan’s Index of Consumer Sentiment rose to 52.9 in December 2025 (+3.7% MoM; -28.5% YoY), showing a modest monthly improvement but still deeply depressed versus last year.

• The Current Economic Conditions Index slipped to 50.4 (-1.4% MoM; -32.9% YoY), indicating continued deterioration in assessments of present financial and buying conditions.

• The Index of Consumer Expectations increased to 54.6 (+7.1% MoM; -25.5% YoY), reflecting firmer views on personal finances and business conditions despite weak overall sentiment.

• Sentiment gains were concentrated among lower-income consumers, while higher-income consumers’ sentiment was little changed, pointing to uneven improvements across income groups.

• Buying conditions for durable goods fell for a fifth consecutive month, highlighting ongoing pressure from prices and financing conditions.

• Labor market expectations improved slightly, though 63% of consumers still expect unemployment to rise over the next year, keeping outlooks cautious.

• Year-ahead inflation expectations declined to 4.2%, the fourth consecutive monthly drop and the lowest reading in 11 months, though still above the 3.3% level seen in January.

• Long-run inflation expectations eased to 3.2%, matching the January 2025 reading and remaining above the 2.8–3.2% range observed last year.