Iowa City, Iowa — You may have noticed some retailers began their holiday sales pitches well before Halloween, making October the start of the holiday shopping period. With inflation pumping up prices on everything from gas to groceries Anne Villamil, an economics professor at the University of Iowa, says many retailers are worried that increased costs will force consumers to limit their gift-giving.
In terms of holiday spending, Halloween is usually second only to Christmas, but candy prices were up 13-percent from a year ago, forcing some Iowans to leave their porch lights off, a sign for trick-or-treaters to stay away. Stores across Iowa will quickly replace the orange-and-black aisles with red-and-green, but Villamil can’t predict how merchants may fare in the holiday ahead.
Inflation rates will fall in the long run, she says, but the Federal Reserve will likely continue nudging rates up in the short-term to prod people into spending less, prompting prices to eventually fall.
National reports indicate Americans plan to spend about the same amount of money on holiday shopping this year as they did last year, but recognize that with inflation, it’ll mean fewer gifts under the tree.
