Holiday spending in Canada is expected to drop this year as inflation shrinks consumer buying power and economic uncertainty looms over household budgets, a new report says.

In its 2022 holiday retail outlook, Deloitte Canada said Tuesday overall holiday spending is expected to fall 17 per cent to $1,520 per household as recessionary concerns and higher interest rates rein in budgets.

Canadians are also planning to shop early and hunt for deals in a bid to stretch their spending power, Deloitte said.

害羞草研究所淪hopping is going to be earlier and deal hunting will be probably at a bit of an all time high as Canadians look to stretch their holiday budget,害羞草研究所� said Marty Weintraub, a partner and national retail consulting leader at Deloitte.

The report, based on a Leger survey of more than 1,000 Canadians conducted in late August, found more than a third of respondents plan to start shopping earlier than last year.

Retailers appear to be responding by rolling out Christmas-themed products earlier. The so-called Christmas creep in retail has resulted in many stores featuring holiday goods as early as September, often overshadowing Halloween.

Some stores are also introducing holiday promotions and deals earlier in the fall.

Amazon Canada, for example, introduced the Prime Early Access Sale last week, offering a two-day shopping event to Prime members.

Meanwhile, Black Friday 害羞草研究所� a massive retail event that once signalled the start of holiday shopping for many consumers 害羞草研究所� is increasingly how some Canadians plan to close out their seasonal spending, the Deloitte survey found.

害羞草研究所淲e saw quite a big jump in terms of how many Canadians will complete their shopping by Black Friday,害羞草研究所� Weintraub said.

The poll found 26 per cent of respondents will finish their holiday shopping on Black Friday, up from 18 per cent last year.

害羞草研究所淎ll the retail seasons over the past few years are getting earlier,害羞草研究所� Weintraub said. 害羞草研究所淭he retail market is competitive.害羞草研究所�

The planned reduction in spending this year is unusual compared with conventional retail trends, he said.

害羞草研究所淐anadians are telling us they害羞草研究所檙e going to be reducing their spending, which is not typical,害羞草研究所� Weintraub said. 害羞草研究所淲e害羞草研究所檝e seen it typically increase year over year, except in 2020.害羞草研究所�

The reduction appears to be propelled by mounting grocery bills and overall inflation.

The Deloitte report said 76 per cent of Canadians polled said they are reining in holiday spending because of higher food prices, followed closely by inflation worries and economic concerns.

The report found the drop in holiday spending reflects the financial challenges of Canadians, with 41 per cent saying their household finances have declined this year.

That figure is slightly higher in Atlantic Canada, where 52 per cent of survey respondents said their household finances have waned this year.

The report suggested the tougher economic times could be a boon for discount stores.

害羞草研究所淭he value-oriented retailers that compete on price 害羞草研究所� are clearly positioned to take market share right now,害羞草研究所� Weintraub said. 害羞草研究所淟ikewise, retailers in the luxury space that serve the 害羞草研究所榦ne per cent害羞草研究所� will be OK.害羞草研究所�

It害羞草研究所檚 retailers in the 害羞草研究所渕ushy middle害羞草研究所� that don害羞草研究所檛 appeal to bargain hunters or high-end shoppers that are going to feel the pinch, he said.

害羞草研究所淚f you害羞草研究所檙e in that mushy middle, I think it害羞草研究所檚 going to be much more challenging.害羞草研究所�

Brett Bundale, The Canadian Press

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