Consumers will spend less this Black Friday, kicking off an uncertain holiday season

This Thursday, November 27, the United States will celebrate Thanksgiving, marking the start of a holiday season in which consumers are more worried than ever about their finances. A Deloitte survey shows that shoppers plan to spend 4% less during the two major U.S. shopping events — Black Friday and Cyber Monday — held over Thanksgiving weekend. Data from the polling firm indicates that 2025 marks a significant trend shift because household spending intentions nationwide used to increase year after year.

Both ends of the socioeconomic spectrum are expected to cut back. Consumers earning around $50,000 a year will spend 12% less than in 2024, while those making over $200,000 say they will reduce their spending by up to 18%.

Inflation has been rising since April, according to official figures, reaching an annual rate of 3% in September. U.S. President Donald Trump’s tariff war has been one of the causes of the price increases that have left Americans oscillating between frustration and uncertainty. Last week, the president softened the policy and announced a tariff cut on Brazil to lower the price of meat, coffee, and other fresh products.

Consumer confidence is at rock bottom. A University of Michigan study shows sentiment in November at its lowest recorded levels, just slightly above the June 2022 minimum. The survey highlighted that people are particularly worried about their jobs and personal finances: 69% fear unemployment will rise next year (twice as many as last year), and they expect inflation to reach 4.5% in 2026. “After the federal shutdown ended, sentiment lifted slightly from its mid-month reading. However, consumers remain frustrated about the persistence of high prices and weakening incomes,” said Joanne Hsu, director of the study.

The financial strain has pushed consumers to look for alternatives, and some major retailers have benefited. Walmart reported strong results last week. Its sales strategy is attracting shoppers looking to save money on groceries and other essential items. The company said even higher-income families are turning to the retailer for deals. “As pocketbooks have been stretched, you’re seeing more consumer dollars go to necessities versus discretionary items,” said CFO John David Rainey.

Gap and TJX Cos, owner of T.J. Maxx and Marshalls stores, also reported strong quarterly results, another sign that shoppers are prioritizing affordability. Conversely, Target and Bath & Body Works — stores geared toward a higher-income segment — are struggling to boost sales.

This holiday season will also see a rise in “buy now, pay later” digital services. A PayPal report shows that half of shoppers plan to use apps like Klarna, Afterpay, and Affirm, which allow purchases to be paid in installments, generally with 0% interest.

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