US consumer sentiment improves in December

Consumer sentiment in the US improved in December, according to final data released on Friday.

The University of Michigan consumer sentiment index printed at 99.3 from 96.8 in November and 98.3 in December 2018.

The current economic conditions index came in at 115.6 from 111.6 the month before and 116.1 in the same month a year ago.

Meanwhile, the index of consumer expectations rose to 88.9 in December from 87.3 in November and 87.0 in December last year.

Surveys of Consumers chief economist, Richard Curtin, said: "Most of the December gain was among upper income households, with those in the top third of the income distribution gaining 7.5% from last month and those in the bottom two-thirds posting a gain of just 0.8%. The recent shift favuoring higher income households is in the opposite direction when compared with all-time peaks in the late 1990's. The impeachment hearing had a barely noticeable impact on economic expectations, as it was mentioned by just 2% of all consumers in the December survey.

"Inflation expectations declined in the December survey, with both the year-ahead and five-year expected inflation rates falling. For the year-ahead, an annual inflation rate of 2.3% was expected, the lowest since 2.2% was recorded twice, in December 2016 and September 2010 prior to the Great Recession's lows. Over the next five years, consumers expected an annual inflation rate of just 2.2% in December 2019, the lowest level since this question was first introduced in the late 1970s."