Canadian holiday gift spending expected to be down by 5%: Report

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Deloitte Canada’s 2026 Holiday Retail Outlook says spending on gifts and gift cards is projected to drop 5% this year with spending on holiday entertaining and experiences sharply down 22% and 20%, respectively, contributing to the lowest overall holiday spending level ($1,305) since the survey began a decade ago.

The outlook also says 83% are expressing concerns about the impact of tariffs on prices and the broader economy with 78% actively looking for more discounts, promotions, and sales and 77% prioritizing reasonable prices and value when choosing a retailer.

“It’s what Canadians intend to spend versus what they actually will spend,” said Shaunna Conway, partner and national retail leader at Deloitte Canada.

“And I think it will be interesting to see what happens as these results translate into actual spending. Canadians are cautious about spending, 74% worried about a recession, the intention is to spend less, down 14% (aggregate spending overall), and I think what it shows is that we’re saving more. So what that means is we’re worried about a recession and we are therefore spending the time to think about how we spend a little differently this year. I think this is not unexpected.”

Almost 30% intend to spend less in 2026

The outlook also reveals that nearly one-third of Canadians or 29% intend to spend less this year as they become increasingly focused on maximizing value.

At the same time, consumers expected to visit an average of 16 stores and digital destinations when looking for gifts, up from 14 last year, to shop and compare.

“Value is top of mind for the Canadian shopper and prices open the door but having the inventory will keep the shopper in your brand,” Conway said.

“And so I think for retailers it’s important to ensure you have the products that the customer wants and that you are top of mind in your marketing. In this year price will be where the Canadian shopper looks and they’re looking at over 16 destinations before they spend and I think that’s a really important fact for our retailers.”

Almost 40% plan to use AI when it comes to holiday spending

When it comes to AI, nearly four in 10 consumers also plan to use it for holiday shopping, primarily for inspiration, price comparing and deals compared with 25% in 2025.

“Canadians are cautious, they’re looking for value and they’re leveraging AI more than before and those three things combined are not necessarily surprisingly,” Conway said. “I think retailers have strategies in place to be ready for the year.”

The report also found that eight per cent feel a lot better about their finances, 18% feel somewhat better, 27% feel somewhat improved, and 40% feel unchanged.

One in three Canadians (34%) say their household finances are worse than a year ago (versus 32% last year), and 25% are somewhat worse and nine per cent are a lot worse.

Another 45% expect the economy to weaken by 2027, while concerns about the possibility of a recession have risen (74% versus 70% last year).

While nearly eight in 10 (79%) expect holiday prices to be higher than in 2025 (up from 70% last year), 63% believe retailers are raising prices more than necessary.

More than half (51%) of budgets are expected to be spent by the end of the Black Friday and Cyber Monday period and 55% of planned holiday spending is expected to take place in-store, compared with 42% online, Amazon (65%) and Google (64%).

The Deloitte Canada survey was conducted between Aug. 28-Sept. 4, polling Canadian consumers across age groups, financial situations, and regions.

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