Photo: Wrapped holiday gifts / Bim24, Wikimedia Commons / CC0
By: JBizNews Desk 🌎
Americans will spend more this holiday season, but nearly all of the increase is higher prices rather than more gifts: Visa expects holiday sales to rise 4.5% from a year earlier, and only 1.1% after inflation is stripped out, below the 1.3% increase after inflation last holiday season, Visa principal U.S. economist Michael Brown told CNBC on Thursday morning (Nov. 5, 6:00 a.m. ET).
Higher receipts do not necessarily mean more items sold, Brown said. Even so, retailers may ring up more spending on physical gifts as shoppers rein in travel, he said.
Wish lists point the other way. More than half of the people Visa surveyed put travel and live events at the top of their wish lists, but only 15% said they are prioritizing spending on experiences for others, while 27% plan to favor physical gifts, according to Visa’s Oct. 30 release.
Travel is taking the biggest cut. Only households earning above $200,000 spent more on trips departing Nov. 1 into early 2027 than they did a year earlier, while lower-income consumers are prioritizing value, Brown said. Roughly a third of households earning under $100,000 plan to switch to lower-cost brands or stores for holiday gifts this season, Visa’s survey found.
For your holiday budget: a bigger bill at the register this year will mostly reflect higher prices, not a bigger pile of presents. With airfares up sharply, many families plan to celebrate closer to home and put more of the budget into physical gifts, and shoppers on tighter budgets are trading down to cheaper brands and stores to make the numbers work, CNBC reported.
JBizNews Desk | New York
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