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I would think people will be more inclined to spend money on activities and experiences rather than goods, not just because Christmas is about spending quality time with people but because the increase in prices would prompt people to be more conscious of how they spend money. Also, after we’ve been in lockdown for such a long time, getting together with friends and family is a huge thing. Hence some people might be willing to take a loan or request an overdraft, credit card, etc., to be able to enjoy this period (this, of course, will depend on whether the Bank of England increases the interest rate this year or not). If so, people will reduce spending in January and will focus on repaying their debts. But for the next couple of months, I think the hospitality industry will be a winner. Still, they will also feel a lot of pressure as more job vacancies are available and fewer people are willing to fill the positions.
Those interested in purchasing gifts and stuff could wait until Black Friday to get discounted goods that they can easily get online as people seem less willing to queue at stores considering COVID is still a risk. They could also rely on Buy-now-pay-later. However, are goods going to be delivered on time? I doubt it… and BNPL services seem to be widely available online with few in-store options. In such a case, this may be beneficial for department stores, as they can rely on eye-catching sales to attract consumer attention. But again, I don’t think retail spending will be that popular compared to previous years. What I think will increase spending is food. If the situation in the supermarkets doesn’t stabilise soon, people will start pilling up food in preparation for Christmas and New Year’s Eve.