Stronger November Spending Softens December’s Index of Consumer Spending
Index of Consumer Spending
Canada’s Index of Consumer Spending stood at 114.8 in December 2025, a decline of 4.4 points compared with November (April 2022 = 100).
- The Index of Consumer Spending declined across all provinces in December 2025. The Atlantic region led the decline, with Nova Scotia down 9.0 points that month and New Brunswick down 6.8 points. Total spending in Canada’s largest provinces also experienced decreases, with Ontario down 5.8 points and Quebec down 5.4 points. These declines are consistent with Statistics Canada’s retail trade results that show strong November gains and an advance estimate of a national pullback in December.
- The Northwest Territories was the only territory or province to post a month‑to‑month increase, rising by 1.5 points in December, while Nunavut experienced the steepest territorial decline, falling by 6.0 points.
- Holiday spending was pulled into November, leaving December softer. Statistics Canada reports that sales across most retail subsectors increased by 1.3 per cent in November, while its advanced estimates indicate that retail sales declined by 0.5 per cent in December. This pattern suggests that strong November promotions caused a meaningful portion of holiday shopping to occur earlier than usual, particularly around Black Friday and Cyber Monday. The result was fewer transactions and lower total dollar volumes recorded for December.
- Consumer confidence stabilized but remained cautious in 2025. Our Index of Consumer Confidence reports that sentiment inched higher in December but remained roughly unchanged from the same period one year earlier. This indicates that households were less pessimistic than earlier in the fall but not confident enough to materially increase spending. This level of caution is consistent with consumers restraining total monthly expenditures rather than sustaining November’s strong pace into December.
- Labour market developments reduced spending momentum at the margin. While overall employment levels saw little change in December, the unemployment rate that month rose to 6.8 per cent as more Canadians entered the workforce in search of employment. Employment declined among youth aged 15 to 24 and job losses were recorded in accommodation and food services, a sector closely tied to discretionary consumer spending. This reinforced the notion that households were exercising more cautious discretionary spending heading into year-end.
- Stable interest rates provided some support but no additional lift to consumer spending. The Bank of Canada held its policy interest rate at 2.25 per cent in mid-December, which eased pressure on variable rate mortgage holders and other borrowers. However, this stability did not translate into stronger spending momentum. With consumers already cautious, as reflected in our Index of Consumer Confidence remaining unchanged from 2024, steady interest rates were not enough to offset the slowdown that followed November’s front-loaded holiday activity. As a result, interest rate stability played a supportive but limited role in December, helping households manage debt costs but not encouraging higher levels of total nominal spending.
The Northwest Territories was the only territory or province to post a month‑to‑month increase, rising by 1.5 points in December.
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The Index of Consumer Spending is powered by exclusive consumer transaction data provided by Moneris Data Services. Moneris is Canada’s number one payment processor with over 3.5 billion transactions spanning more than 325,000 merchant locations. Our index tracks incremental changes in net transaction volume month-over-month from a set starting point (April 2022 = 100), enabling us to gauge economic activity levels across the country and provide insights into how the Canadian economy is performing coast to coast.
Updates on this index will be released monthly.
The Index of Consumer Spending’s (ICS) methodology has been revised for releases from January 2024 onwards. The ICS no longer tracks the weekly year-on-year changes in consumer spending. Instead, the ICS now tracks the incremental changes in net transaction volume month-over-month, from a set starting point (April 2022 = 100).
Disclaimer: Forecasts and research often involve numerous assumptions and data sources and are subject to inherent risks and uncertainties. This information is not intended as specific investment, accounting, legal, or tax advice.