Inflation in America has been lower on average in 2025 than last year, with year-over-year inflation reaching 2.7% in November. Major items in family budgets are at multi-year lows, and rent is at its lowest point since October 2021, while grocery prices have also declined. Further, if you are choosing to travel for the holidays, gas prices have fallen to their lowest levels in four years. Airfares have dropped 5.4% over the last 12 months, so cross-country travel is more affordable as well.
Not only are prices lower, but real wages have risen on average $1,300 over the year. More money in your pocket means less stress around the holidays and being able to afford gifts and groceries needed to celebrate properly.
Christmas trees and cookies have risen the most since last year, rising 6.4% and 5.1% respectively. While these items have become more expensive, many reasons can contribute to the rise in tree prices. Severe weather and fires throughout the year have hit Christmas tree farms, making fresh trees more costly and driving up the demand for artificial trees, which can push the prices up further.
Cookies, on the other hand, have fluctuated throughout the year. Although cookie prices are higher than average this month, prices have been significantly lower on average than in previous years. Various events can contribute to the rise of cookies, such as supply chain issues or the rise of flour and egg prices.
Other Christmas items have risen modestly or even fallen.
- Milk has fallen 0.8%
- Eggnog has fallen 1.6%
- Christmas lights 1.3%
- Fruit cake has risen 1.9%
- Wrapping paper has remained steady with no price change
- Toys have increased 0.5%
Given the positive report of the economy recently, these are modest increases alongside the increases in real wages.
A commitment to energy abundance—scaling up oil, gas, and nuclear investments under the Trump administration—has and will continue to positively affect gas prices. Tax cuts and further deregulation will only help affordability for American families.
Christmas affordability comes in different ways this year. While not all Christmas-related items have seen price decreases, the margin in family budgets from lower rent, lower gas prices, and higher wages allows families to celebrate the holidays with joy instead of financial stress.
Bottom Line
Christmas is a time to gather and celebrate with those you love, to count the blessings of the year, and look forward to more blessings, better policy, and more savings in the year to come. Put out those milk and cookies, wrap gifts and toys for little ones, and find joy in Christmas, knowing prices are lower now thanks to sound policy.