Mariah Carey’s “All I want for Christmas is you,” playing on loud retail store speakers, red and green decor at the turn of every corner, the sound of laughter followed by sips of Starbucks’ holiday drinks, Christmas time is definitely here. However, the Grinch’s newest form is also just around the corner. Inflation.
With the holidays coming up, many Americans worry about the weight the gift-giving season will have on their wallets and holiday spirits.
Tariffs and inflation have played a huge role in the decline in holiday spirit this year. Back at the beginning of President Trump’s second term, the tariff feud between China and the United States sparked high anxiety among retailers, heightening concerns about holiday decor and gifts. Because retailers had to purchase products at a higher price due to the tariffs, their way of making that money up and profit is going to be the increase in prices, hence the increase in holiday stress.
“So if we produce it domestically, you don’t see that price change, but if we import, like clothing is heavily imported, then we’re gonna see an increase,” Candace Fikis, AP Macroeconomics and AP Microeconomics teacher at WEGO, said.
Because inflation is essentially the increase in costs, the most important factor affecting the stress of holiday shopping is wages. Inflation is increasing faster than wages, and Americans will have to pay a higher price for the same amount of product they would have gotten last year.
Although it is difficult to get a steady read on the inflation prices because of the constant change in tariffs, according to the U.S Bureau of Labor Statistics, the inflation rate from December 2024 to September 2025 is up by 5%. While the product is still the same, the price will increase.
“Okay, we’re gonna put a 50% tariff, and then a week later it’s down to 10% so it’s been hard to track the major impact, but overall we are seeing producers are having to pay more,” Fikis said.
Gifts are not the only aspect of the holidays that are being affected by the ongoing tariff war; Christmas decor has its own problems this year. Artificial Christmas trees are estimated to cost between 10%-20% more than they did last year, according to the American Christmas Tree Association. Christmas lights rose 63% in costs from last year’s record.
If the Christmas decor were domestically made, the prices would be even higher than they are now, even with inflation. Mark Harman, CEO of Balsalm Hill, an artificial tree vendor company, estimates that 90% of Christmas decor is internationally made, making them some of the highest products affected by the tariff war.
Consumers are not happy about this.
“I have to buy gifts for my four siblings, my boyfriend, my friends, multiple secret Santas, and for my parents; it’s a lot of gifts,” Keelie Steward, junior at West Chicago Community High School, said. “It is not looking good, it is not looking good at all. A lot of random stuff, I have noticed an increase in clothes, especially thrifting, which is insane.”
Some think this stress may dull the Christmas spirit.
“I think that people are going to be really stressed about gift buying, and it will just make people forget to be happy about the Christmas spirit,” Steward said.
Although inflation and tariffs have definitely affected the holidays and all the shopping that comes with it, there might be a way to get around it.
“Use coupons. Use apps, that is the best thing about tech right now. Price comparison. Thrifting and making more personalized items, or maybe even just a little basket. Definitely make a budget, make it, and stick to it,” Fikis said.
