Sometimes it feels like 2025 is shaping up to be the year that is impossible to predict.

The speed with which things are changing and developing – at a political level, at a technological level – is creating mass uncertainty. It’s possible that between us sending this and you reading it that things will have changed again.

What we do know is that, even in an uncertain climate, consumers spend. So, what does this look like in 2025? And does this consumer spending behaviour differ between the US and the UK?

To find out, we’ve asked the brilliant Melissa Minkow to share her observations from the US, while our own Jack Stratten offers his insights from the UK.

Just remember there’s no such thing as a dead cert in 2025.

How do you see consumer spending changing over the rest of 2025?

Melissa – In the US, 2024 was a year of growth, mostly thanks to the fact that retailers could offer strong discounts, and consumers, driven by an urge to save everywhere possible, reacted well to that.

In 2025, consumer confidence has dropped to its lowest level in 12 years, the stock market has been extremely volatile, the price of goods has been such a hot topic because of just finishing off an election year, and 54% of consumers in our annual Connected Retail Study told us they expect prices on most goods to go up.

So, I just don’t see a world in which retail sales growth is feasible. Shoppers are at a breaking point in terms of stress over prices, and retailers aren’t in a position this year to offer the strong discounts of last year, as they’re trying to cut costs everywhere possible in the face of potential tariffs. I believe pullbacks will happen in every category.

Jack – I think it’s almost impossible to see anything other than an overall drop in consumer spending. Global conditions, as well as UK-specific ones, just point to that – and that’s whether you’re looking at lower or higher income consumers.

But of course, the picture will be complex. I think traditional luxury brands and sectors will feel the pinch, and consumers will cut down on lots of non-essentials.

However, I also wonder whether 2025 will be so turbulent, given everything Trump is up to, that we will see some Covid-like consumer behaviours.

By which I mean, lots of cautious spending, a focus on low-cost grocery shopping – but also a bit of splurging too. What’s going on in the world continues to fuel anxiety in customers, and during Covid that anxiety actually led to many luxury brands doing well. Luxury purchasing became a release.

So even within grocery, I think customer spending will be complex. They will be laser focused on discounts, savings and offers – but also looking for indulgence and treats.

I really don’t think there are many consumers left who ever act in a wholly cautious and rational manner, month to month. There is always their own version of indulgence.

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