UK Christmas spending is set for its strongest rise in four years, with retail sales forecast to grow 3.5% in November and December, according to Bain & Company’s new 2026 Holiday Shopping Outlook. That compares with 2.8% growth last year.
But the headline growth masks continued pressure on shoppers. Bain expects more than half of the increase in sales value to come from higher prices, rather than people buying more. Its consumer research also finds that 41% expect to spend more this Christmas, but again higher prices are the main reason given by those increasing their budgets.
Online is expected to be a major driver, with sales forecast to grow 7.5%, compared with 2.8% instore. Bain also finds that 20% of online shoppers expect to start their Christmas shopping on a GenAI platform, rising to around 41% of Gen Z, as AI starts to play a bigger role in how shoppers discover products.
The outlook comes despite continued pressure from inflation, weaker job security and flat disposable incomes, with Bain identifying the Autumn Budget as one factor that could still influence Christmas spending.
