Visa sees US holiday retail sales growing 4.5%, fastest pace since 2021

Nov 5 (Reuters) – US holiday retail sales are set to rise 4.5% year-on-year in the last two months of 2026, marking the strongest growth since 2021, according to research by Visa’s Business and Economics Insights.

Here are more details:

• The research said the forecast pointed to continued consumer resilience supported by solid income growth and household wealth even though high inflation is set to play a part in where “holiday dollars go”

• “Income growth continues to provide an important foundation for spending and while higher prices remain part of the picture, we expect another healthy holiday season,” said Michael Brown, principal US economist at Visa

• Visa and Mastercard both beat earnings estimates for the quarter ended September 30, underscoring the fact that spending has remained resilient

• Consumers are set to spend an average of $777 on holiday gifts this year, up 5.6% from $736 in 2025, the research showed, even though customers are still adapting to high prices

• Despite over half of the surveyed consumers wishing for travel and events, holiday budgets favor traditional spending. Only 15% will prioritize buying experiences, while 27% plan to purchase physical gifts instead, according to the research

• Only households earning over $200,000 increased holiday airfare spending, while lower-income groups pulled back their bookings

(Reporting by Pritam Biswas in Bengaluru; Editing by Shreya Biswas)