Tariff Volatility Dampens Holiday Spending Plans for Canadian Consumers
Holiday shopping is underway at the Toronto Eaton Centre, where the mall’s towering Christmas tree is already drawing crowds and setting the tone for the season.
But as holiday shoppers get an early start, many say they’re planning to pull back on spending amid concerns about the economy, inflation and potential tariff impacts.
Laura Pucci, who works in the mall, says she’s already begun buying gifts, but with a slightly more cautious eye on her budget.
“Things are really expensive now, so I’m probably going to be cutting back a little bit or budgeting well, or just making sure I buy things on Black Friday,” she said.
That caution is being echoed across the country. A new BMO survey shows three in five Canadians are adjusting their holiday spending plans, with some citing worries about tariffs and broader economic uncertainty.
According to the survey – conducted between Sept. 3 and Oct. 11 with more than 2,500 Canadians – 41 per cent of shoppers plan to scale back their spending this year, while 15 per cent say they’re budgeting more in anticipation of higher prices. A quarter of respondents said they started shopping early to avoid possible price hikes.
On average, they’re expected to spend $2,310 this season, which includes travel, dining out, decorations and gifts. The survey found 37 per cent plan to buy items minimally affected by tariffs, including goods made in Canada.
“There’s this general concern from Canadians of maybe needing to be really fiscally responsible over the holiday, because there’s still a little bit of uncertainty about where things are headed next year,” said Tony Tintinalli, head of specialized sales at BMO.
Tintinalli said he expects travel to take a hit as Canadians look to tighten their budgets.
“We’ve already seen a lot of people not really travelling as much to the U.S., and I think a lot of people are not going to be away.”
At the mall, some shoppers shared their plans to curb spending, in some cases severely.
Katelyn Robertson, a full-time student working three jobs, said spending simply isn’t an option this year.
“I have to work a lot to afford rent, so spending money is not on the table,” she said, adding that she also has to pay her tuition.
Others said they were trying to shop early to secure better prices. Jennifer Leithead said she always tries to start ahead of the rush, but plans to spend less this year, partly to save for a possible January trip to Mexico, but also because of rising costs.
“I’m finding the prices have gone up so much even food,” she said. “So this year, definitely spending a lot less on presents in general.”
Theresa Smolinski said she’s only just begun her shopping and still has many gifts left to buy. While she plans to spend more on her grandson, she has noticed prices climbing.
“You have to look around a bit more than you had previously,” she said. “But I’m making it work.”
A separate survey by insolvency firm Harris and Partners found Canadians are heading into the season with added financial stress: 54 per cent said they felt anxious about affording Christmas, and 61 per cent said they don’t feel financially prepared.
As for advice, Tintinalli says having a plan and sticking to your budget is important.
“You can still be really mindful and fiscally responsible if you do a bit of planning.”
This article was first reported by CTV News
