By Innovation Times Business Desk
October 15, 2025 | New York
As the holiday shopping season approaches, a new nationwide survey reveals that most U.S. consumers expect higher prices, slower spending, and a weaker economy heading into the final months of 2025.
According to the University of Michigan’s Consumer Sentiment Index and supporting data from The Conference Board, inflation concerns remain a top issue for Americans, with more than 70% of respondents saying they anticipate higher retail prices on gifts, travel, and dining during the holidays.
The findings come despite signs of a cooling economy and slower job growth. Many households say they plan to cut back on nonessential purchases, delay travel plans, or search for early holiday discounts to manage rising costs.
“Consumers are feeling the pressure of sustained inflation and uncertainty about interest rates,” said Diane Swonk, chief economist at KPMG. “Even if prices aren’t climbing as fast as they were last year, the perception of being financially stretched is weighing heavily on spending confidence.”
Retail analysts say that could translate to a modest holiday season for U.S. retailers, with slower sales growth compared to last year’s robust rebound. Major brands such as Walmart, Target, and Amazon have already begun rolling out early promotions in an attempt to attract cost-conscious shoppers.
The survey also found that 60% of Americans believe the U.S. economy will weaken in 2026, citing persistent inflation, high interest rates, and global trade uncertainty as key risks. The outlook for household finances has also softened, particularly among middle-income families dealing with rising housing and food costs.
Despite the cautious tone, experts note that consumer spending remains resilient, supported by a strong labor market and stable wage growth. However, analysts warn that confidence could falter quickly if economic conditions deteriorate further or if the Federal Reserve maintains high borrowing costs into next year.
