Canadian holiday shopping is becoming a test of both household finances and national loyalties. The Retail Council of Canada (RCC) and Leger put average planned budgets for 2026 C$64 below last year’s level, while many shoppers affected by U.S. politics and trade are avoiding American brands.
The combination creates a difficult choice at the checkout: support a Canadian alternative, protect the gift list, or take the lowest price. Those goals can overlap, but not always. The findings describe intentions rather than completed purchases, and they do not establish that trade politics caused the budget decline. Instead, affordability and product origins appear poised to shape decisions together.
A Smaller Budget Does Not Mean Everyone Is Cutting Back
The average planned budget is C$911, versus C$975 last year—a decrease of approximately 6.6% using the published figures. However, 52% expect to spend about the same, while 22% plan to spend more and 22% less. These results describe a mixed market rather than a uniform retreat. A parent protecting a child’s gift budget and someone cancelling an expensive personal purchase can contribute to the same national average while making very different decisions about what matters most.
The size of those adjustments matters as much as the number of people making them. Equal proportions planning increases and decreases do not guarantee an unchanged average: a few large reductions can outweigh many small additions. Nor is the headline a measure of actual sales or an inflation-adjusted spending decline. Retailers still need to learn whether shoppers will buy fewer items, select cheaper alternatives or move purchases between categories. The immediate signal is tighter planning, not proof that Canadians have collectively abandoned the season.
The American-Brand Backlash Has a Specific Scope
U.S. politics, trade policy or geopolitical instability affects the holiday outlook of 52% of respondents, down from 58% last year. Within that affected group, 58% say they are avoiding American brands and 57% are supporting more local or Canadian-made businesses. The distinction is crucial: the brand-avoidance figure is not a finding that 58% of all Canadians are boycotting American products. It describes the response of shoppers who first identified those political or trade concerns as relevant to their holiday plans.
The two behaviours can also overlap. Someone choosing a Canadian-made gift instead of an American-branded alternative could count in both categories; the percentages cannot simply be added together. Nor does avoiding a brand establish a complete refusal to buy anything associated with the United States. A shopper might switch some purchases while retaining others for price, availability or personal preference. The finding signals a commercial risk for American brands, but it does not identify particular companies’ losses or prove that political concerns have intensified across the whole population.
High Everyday Prices Leave Less Room for Gifts
The pressure on holiday spending begins well before a gift reaches the wrapping table. Statistics Canada’s September 2026 figures show overall consumer prices up 3.1% from a year earlier, with gasoline rising 27.8%. Groceries increased a more modest 1.7%, but their price level was still 33.0% above September 2020. Slower grocery inflation therefore does not mean a return to earlier prices. It means the already-expensive basket is becoming more costly at a slower pace, leaving households to manage the accumulated increase.
Those numbers help explain why a household can feel constrained even when a particular gift has not become more expensive. Fuel, food and other essentials compete with optional purchases for the same income. A family could preserve its usual celebrations while choosing a smaller present, postponing a replacement appliance or skipping an extra outing. These are illustrations of the choices higher living costs can create, not measured explanations for every budget cut. The official inflation figures provide economic context; they do not isolate how much of the holiday-budget decline was caused by tariffs, domestic costs or individual circumstances.
Uncertainty Can Restrain Spending Without a Pay Cut
The Bank of Canada’s October 19 consumer report offers another explanation for caution: people can feel somewhat better about their finances while remaining reluctant to spend. Its third-quarter findings showed improved perceptions of financial health alongside weaker purchasing intentions. About half of consumers expected a recession within the next year, and nearly half believed the most serious economic or inflation effects of trade tensions were still ahead. Those expectations were associated with greater reluctance to make major purchases. They were respondents’ views, not a central-bank prediction that a recession was inevitable.
This distinction brings the story closer to the kitchen table. A worker does not need to lose a job before deciding to keep extra money available. Concern about future expenses can be enough to postpone something optional. In the bank’s follow-up interviews, consumers described reducing discretionary purchases, eating out less and seeking cheaper alternatives. That evidence supports a broader picture of precautionary spending, rather than a simple link between political anger and fewer gifts. For retailers, it suggests that even customers with stable earnings may need reassurance about value before committing to a larger purchase.
Buying Canadian Still Has to Fit the Price Tag
Patriotism can help a product reach the shortlist, but affordability can decide whether it reaches the shopping bag. Deloitte’s 2026 holiday research found that 45% considered Canadian or local ownership important when choosing a retailer, compared with 77% prioritizing reasonable prices and value. Another 35% were unwilling to pay extra based solely on local ownership. For a small Canadian business, the practical opportunity is to make the domestic connection visible while offering something customers can fit into an already-constrained budget.
PwC found a complementary, more encouraging result: 54% would choose a more expensive Canadian-made product when alternatives had a similar look, feel and quality. These findings are not directly interchangeable—Canadian ownership and Canadian manufacture are different considerations, and the questions differ. Together, they suggest that willingness to pay depends on what shoppers believe they are receiving. A hypothetical C$10 premium may feel manageable on one meaningful gift, but repeating it across six purchases adds C$60. The arithmetic helps explain why someone can strongly favour Canadian products without choosing the domestic option every time.
A Canadian Brand Is Not Necessarily a Canadian-Made Product
Buying Canadian can mean supporting a Canadian owner, a Canadian factory or Canadian ingredients—and those are not the same thing. For non-food goods, the Competition Bureau’s guidance generally sets a 51% Canadian direct-production-cost threshold for a qualified “Made in Canada” claim and 98% for “Product of Canada.” Both also require the final substantial transformation to occur in Canada. The former needs an appropriate statement about imported content. These are manufacturing-origin guidelines, not a certification that a company has Canadian owners; food products have separate guidance.
An example from the Thanksgiving table shows the complication. The Canadian Press reported in October that U.S.-based cooperative Ocean Spray processes some Canadian cranberries into jelly sauce. A shopper focused on brand ownership and one focused on supporting Canadian growers could therefore judge the same product differently. Neither objective can be established from a familiar name alone. For holiday retailers, precise explanations of where products are made and what their claims mean could be more useful than broad patriotic imagery. Clear information lets customers decide which economic connection matters most to them.
Families Are Protecting Gifts by Trimming Other Plans
Smaller holiday budgets do not necessarily translate into equally large cuts to presents. Deloitte’s detailed spending tables show planned expenditure on gifts and gift cards falling about 5%, while experiences and holiday entertaining each decline by roughly one-fifth. The pattern suggests that shoppers are trying to preserve gift-giving while finding savings elsewhere. These categories come from Deloitte’s separate study and should not be treated as a breakdown of RCC’s C$911 figure. Different definitions and questions produce different estimates of what a holiday budget includes.
PwC’s research adds a family dimension: individuals living in households with children plan to spend nearly twice as much as those without children. They are also more likely to choose hands-on activities and experiences as children’s gifts. That creates room for a different approach to saving, centred on a shared activity rather than a more expensive object. A family could, for example, replace a costly outing with a modest game everyone plays together. For a Canadian maker or local shop, the opening is not simply to sell something patriotic; it is to offer an affordable gift that still feels personal.
Discount Days Will Test Brand Loyalty
Deloitte expects shoppers to have spent 51% of their holiday budgets by the end of the Black Friday and Cyber Monday period. That is a cumulative figure, including earlier purchases, rather than a prediction that half the season’s spending will occur over one sales weekend. Its research also shows that 80% compare options or wait for better prices. The combination suggests that shoppers are preparing carefully, with both the timing and the final cost of a purchase carrying considerable weight.
That environment will put preferences for Canadian products to a practical test. A domestic alternative may seem attractive until a competing promotion opens a sizeable price gap. Conversely, a well-timed discount could make the Canadian choice easier without requiring shoppers to stretch their budgets. There is no guarantee that the lowest advertised price will win every purchase: availability, delivery costs and confidence in the product can also enter the decision. The important question is whether political preferences survive those everyday comparisons. Sales-period results will provide a clearer answer than expressions of support collected before the busiest shopping weeks.
American Shopping Platforms Complicate the Picture
The relationship with American businesses is more complicated than a simple national shopping divide. Deloitte identifies Amazon and Google as leading destinations for researching holiday purchases, at 65% and 64%, respectively. Those figures concern discovery, not the nationality of the products eventually purchased. They also come from a different study than RCC’s brand-avoidance findings. They cannot establish that the same people expressing opposition to American brands are using particular platforms, or that any individual is contradicting a stated preference.
Still, the distinction illustrates why changes in shopping loyalty can be difficult to measure. A customer could use a global search platform to locate a Canadian-made gift, then complete the purchase directly with its producer. Another might buy a foreign-made item from a Canadian-owned neighbourhood store. Those transactions support different businesses at different stages. For smaller retailers, the opportunity is to provide clear product information wherever customers begin their search, rather than assuming a preference for Canadian goods automatically brings traffic through the door. Finding the right gift and deciding whom to support are connected choices, but they are not identical.
The Checkout Will Decide How Much Changes
The RCC-Leger research was conducted online among 2,500 Canadian adults between August 21 and September 4, 2026, before its October 20 release. Because it used a non-probability sample, a conventional margin of error does not apply. Its findings are a snapshot of intentions collected before the main holiday shopping rush. That timing leaves room for plans to change as promotions appear, household circumstances shift and shoppers discover which products are actually available within their chosen budgets.
The next test will be actual purchases: whether Canadian alternatives gain sales, whether American brands lose business and whether final spending stays close to what people planned. Until those results emerge, the clearest message is that affordability and national loyalties are competing for attention at the same checkout. Canadian sellers have an opportunity, but sympathy alone is not a sale. American brands face resistance among politically affected shoppers, but the evidence does not establish a universal boycott. For families, the immediate goal is more personal: making the holidays feel meaningful without creating financial pressure that lasts long after the decorations come down.
