Americans plan to spend 5% less this holiday season compared to last year — the first pullback since 2020 — as rising costs and tariff worries weigh on wallets, according to PwC's 2025 Holiday Outlook out Wednesday.

Why it matters: The squeeze is hitting gift budgets hardest, shifting dollars toward food and essentials. • It's one of the first sizable surveys to flash a significant warning sign for the retail sector this coming season.

The big picture: The holidays will still happen — but with tighter wallets and more deliberate choices. • The effects of tariffs are expected to be felt more widely this fall, with higher prices, plus a change in product mix and holiday promotions. • Retailers' pre-tariff inventory is nearly depleted — and what hits shelves next will have already bee

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