Americans are bracing for their first holiday spending cutback since 2020, with PwC’s 2025 Holiday Outlook showing a five percent drop from last year. The survey, released Wednesday, suggests consumers will spend an average of $1,552 this season, down from $1,638 in 2024, with gift budgets hit the hardest. Spending on presents is projected to fall 11 percent to $721, compared to $814 last year. PwC found that 84 percent of respondents expect to scale back in the next six months, citing costs and uncertainty. Younger shoppers are leading the pullback, with Gen Z planning to cut back by 23 percent, while baby boomers expect to spend five percent more and Gen X about two percent more. Millennials remain roughly flat. Families with children are still powering holiday spending, averaging $2,349 compared to $1,089 among households without kids. Nearly 40 percent of gift budgets will be spent between Thanksgiving and Cyber Monday, with almost 80 percent wrapped up by then. Retailers, however, are running low on pre-tariff inventory, and new shipments will carry higher tariff costs that are already being passed on. A federal court ruled much of President Trump’s trade agenda illegal last week, prompting him to announce Tuesday that his administration would appeal to the Supreme Court.
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