According to McKinsey & Company’s latest consumer sentiment research (surveyed July 29–August 5), US holiday budgets remain stable, but consumers are cutting back sharply on discretionary items like jewelry.

• Jewellery Spending Pullback: 43% of US consumers plan to spend less on jewelry this holiday season, while 39% expect to spend the same, and only 18% plan to spend more. This yields a net spending intent of -25%.
• High Category Risk: Accessories (-30%) and home decor (-32%) recorded the lowest net spending intent across 22 discretionary categories.
• Overall Holiday Budgets: Across all categories, 47% of consumers plan to match last year’s spending, 23% plan to spend more, and 21% plan to spend less.
• Bright Spots & Demographics: Gen Z consumers show higher planned spending on jewelry and accessories relative to older generations.

 Bain & Company forecasts

• Total US holiday sales to rise 4.5% year-over-year to a record $1.016 trillion.
• In-store sales are projected to grow 2.5%, while non-store (e-commerce) sales are expected to jump 9%.
• Half of this nominal growth is driven by inflation rather than unit volume.

While macro retail figures point to growth, McKinsey’s findings indicate jewelry retailers face an intense battle for market share against apparel, electronics, and travel. Success will depend on capturing a increasingly selective consumer base.