The holiday season has always been Canada’s unofficial Olympics of spending a time when families stretch their budgets for gifts, travel, and festive indulgence. But this year feels different. Not just because prices are up or because the economy is sluggish, but because consumers are clearly changing the way they behave. And frankly, who can blame them?
A recent Bank of Montreal survey shows something many of us have already felt in our day-to-day lives: Canadians are done pretending everything is “business as usual.” According to the poll, 61 percent have revised their holiday budgets specifically because of tariff concerns, and 41 percent are cutting back due to the rising cost of living. Roughly a quarter of Canadians even started shopping early not out of excitement, but out of fear that waiting would cost them more.
And that fear isn’t unfounded. With a 35 percent U.S. tariff slapped on Canadian goods outside the USMCA and retaliatory duties bouncing between China and Canada, consumers are caught in the economic crossfire. Add in rising unemployment and a climb in inflation, and suddenly the holiday season looks less like a time for joy and more like a lesson in financial triage.
BMO senior economist Sal Guatieri put it plainly: this year’s economic conditions have “undermined consumer confidence and income growth.” In other words, people don’t feel secure and insecure consumers don’t spend freely.
What’s interesting, though, is how Canadians are responding. They’re not just cutting spending; they’re recalibrating their values. Forty-six percent plan to reduce holiday décor costs. Many are trimming budgets for travel, dining out, toys, alcohol, clothing, and social hosting. Meanwhile, purchases considered “essential,” like groceries, are actually seeing an increase.
There’s also a quiet rise in economic patriotism: 37 percent say they’re intentionally buying Canadian-made products to dodge tariff impacts. And nearly 4 in 10 shoppers are turning to sales, clearance racks, and discount retailers, showing that frugality is the new normal or at least the new seasonal strategy.
This shift isn’t entirely bleak. In fact, it may signal a healthy correction in how we approach holiday consumerism. Over time, perhaps we drifted a little too far into excess, treating the season like a competition in spending rather than an opportunity for meaning and connection. If tariffs, inflation, and uncertainty are nudging us toward more intentional choices, maybe that’s not all bad.
Still, it’s impossible to ignore the underlying issue: Canadians are making these adjustments not because they want to, but because they have to. Inflation is eating into wages. Unemployment remains uncomfortably high. International trade tensions spill into the grocery aisles and gift sections. And households are simply stretched.
So yes Canadians are showing resilience, as BMO’s Anthony Tintinalli said. But resilience is not the same as contentment. It’s what people do when circumstances give them no alternative.
This holiday season, Canadians are rewriting their budgets, rethinking their priorities, and redefining what celebration looks like. The question is whether policymakers and trading partners will notice that these aren’t just statistics. They are signs of a country learning to cope with strain, one discounted gift at a time.
And if the economic winds don’t shift soon, next year’s holiday story may look very similar only with even less tinsel.
