UK Leads Europe's Holiday Spending Growth at 4.5%, Mastercard Says

European holiday retail sales will grow 3.4% year over year between November 1 and December 26, and the UK and Czechia share the top spot at 4.5%, according to the Mastercard Economics Institute's annual holiday forecast. The figures, based on SpendingPulse data covering in-store and online spending across all payment forms, exclude automobiles and fuel and are not adjusted for inflation.

E-commerce is the standout. Spain leads online growth at 11.2%, followed by Poland at 10.9% and Hungary at 10.1%. The UK posts 9.3% e-commerce growth and Germany trails the nine measured markets at 4.7% total growth. The forecast covers Czech Republic, France, Germany, Hungary, Italy, Netherlands, Poland, Spain and the United Kingdom.

What's behind the resilience?

Labour markets across much of Europe remain robust, with unemployment near historic lows. Eurozone core inflation, excluding energy and food, has stayed relatively stable over the past six months. But pressures are building. Natural gas prices have risen since summer, and Mastercard expects energy and fuel costs to climb during the holidays. The institute also expects price pressures to broaden into goods, services and food — reinforcing European shoppers' long-standing focus on value.

Why are Brits shopping later into the night?

Late-night buying is now a structural habit, not a quirk. In the UK, the share of online spending after 8pm rose from 12% in 2019 to 15% across January–September 2025, and hits 17% during the holiday season. In Spain, nearly a quarter of online holiday spending happens after 8pm. Since the early 2010s, online spending has consistently outpaced in-store growth, peaking around Black Friday and Cyber Monday. Premium fashion, beauty, sporting goods and electronics see the largest online uplift.

How does AI change holiday buying patterns?

The institute compared AI subscribers and non-subscribers during Black Friday weekend and December 20–25. The differences are concrete:

• AI subscribers concentrate lifestyle spending — fashion, beauty, home furnishings — in the Black Friday window; non-subscribers chase discounted electronics. In Spain, 15% of non-subscribers' electronics spending lands in the Black Friday–Cyber Monday period versus 12% for AI subscribers.
• AI subscribers shop later, doing a larger share of in-store spending last-minute. Jewellery is the popular late buy, especially in Czech Republic, Italy and the UK.
• Non-subscribers spread purchases evenly across the season; AI subscribers cluster them at peak moments.

Do small businesses win the season?

Yes, in person and in business spend. Seasonal in-person spending share rises for UK travel agencies (+4pp), live performances in Italy and Poland (+5pp), Spanish arts and crafts stores (+4pp), Czech florists (+4pp) and French independent cinemas (+3pp). Business spending peaks in Q4: nearly a third of annual European restaurant spending by small and large businesses falls in that quarter, and the same share applies to electronics and appliances. UK holiday restaurant transactions on small business cards run twice the value of consumer ones; large corporate cards run about five times larger.

Travel is also shifting. Asian destinations top the growth rankings for European travellers in November–December, led by Phuket, with Tokyo and Bangkok close behind. Montreal and Toronto rank among the fastest-growing long-haul picks; city breaks in Poland, Italy and Bratislava draw interest closer to home.

Natalia Lechmanova, Chief Economist Europe at the Mastercard Economics Institute, said: "The 2026 holiday season reflects a European consumer who is both resilient and increasingly digital. Shoppers are embracing greater flexibility, purchasing online at all hours and turning to AI to help navigate holiday purchases. At the same time, spending on experiences, travel and at local businesses highlights consumers' continued desire to celebrate, connect and create meaningful moments during the holiday period."

For marketers, the signal is timing: budgets and promotions now need to perform at 8pm and later, and in concentrated peak windows rather than an even seasonal spread.