Expect a spendy but price-conscious holiday season

Summary

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Podcast Summary: Marketplace Morning Report

Episode: Expect a spendy but price-conscious holiday season
Date: October 16, 2025
Host: Sabri Benishour (in for David Brancaccio)
Length: Approx 10 minutes

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Overview

Today’s episode focuses primarily on the upcoming holiday shopping season, forecasting consumer behavior and retailer strategies amid ongoing economic uncertainties and a divided consumer base. Additional segments touch on India’s complex position regarding Russian oil in the face of U.S. political pressure, and the impact of potential federal cutbacks on the Community Development Financial Institutions Fund (CDFI), a vital support system for underserved communities and small businesses.

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Key Discussion Points & Insights

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1. A Cautious, Value-driven Holiday Shopping Season

(00:57 – 02:39)

• Early Start and Economic Backdrop:
  The holiday shopping season is already underway in the retail industry, with executives preparing for their most significant sales period amid tariffs and economic stratification among consumers.
• Consumer Caution:
  Economic uncertainty is encouraging more conservative spending, especially among lower-income shoppers.
  • Quote (Gregory Dacko, EY):
    “We think consumers will be more conservative, more judicious when it comes to how many gifts they purchase.” (01:32)
• Modest Growth Expected:
  EY's holiday retail forecast projects a 2.5% increase in sales, largely due to higher prices rather than increased volume.
  • Quote (Gregory Dacko, EY):
    “That will largely reflect an increase in prices rather than an increase in volumes.” (01:49)
• More Optimistic View:
  Arun Sundaram from CFRA Research predicts stronger sales volumes, citing robust back-to-school performance as a leading indicator.
  • Quote (Arun Sundaram, CFRA):
    “Prices played a role in it as well. But also volumes or unit sales were strong...” (02:03)
• Retailer Strategy Shifts:
  Major chains focus on attracting value-driven consumers with cheaper store brands and entry-level pricing.
  • Target is emphasizing $20 clothing and affordable gifts. (02:18)
  • Costco and Walmart leverage loyalty data and AI for personalized deals while still protecting their profit margins.
    • Quote (Sundaram):
      “That allows them to protect their margins while still appearing competitive on prices.” (02:36)
• Season Outlook:
  Overall, analysts agree: 2025’s holiday may be “good, even if not a great one.” (02:39)

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2. India’s Stance on Buying Russian Oil

(02:48 – 04:14)

• Diplomatic Developments:
  President Donald Trump announced that India agreed to stop importing Russian oil, intending to pressure Moscow over Ukraine.
• India Pushes Back:
  Indian officials, however, reaffirm their priority is national energy security, not U.S. demands.
  • Quote (Arunde Mukherjee, BBC):
    "India has consistently resisted growing pressure from the US over its Russian oil imports, saying it needs to secure its energy requirements..." (03:18)
• Open to Diversification:
  India’s foreign ministry says oil import diversification remains possible if it meets India's needs.
• Broader Context:
  India maintains its neutral stance in the Russia-Ukraine conflict, and close ties with Russia continue despite diplomatic pressure.

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3. Federal Judge Blocks Attempt to Eliminate CDFI Fund

(05:43 – 08:41)

• What Happened:
  A federal judge has temporarily stopped the Trump administration's push to fire federal workers within the CDFI Fund during the government shutdown.
• CDFI Fund’s Role:
  The fund supports mission-driven lenders in rural, tribal, and underserved areas, distributing $400 million+ last year.
• Local Impact – Louisville, KY:
  L Home, a local lender, relies on CDFI grants and especially on government certification for credibility.
  • Quote (Keith Talley, L Home):
    “That certification helps when we are applying for loans from other funders, and they like knowing that there is a third party that's making sure that we, as a CDFI, are lending in the neighborhoods and doing the type of lending that we said we were going to do.” (06:53)
• Big Picture:
  Michael Swack notes the CDFI Fund crowds in private investment that would otherwise not reach marginalized communities.
  • Quote (Michael Swack, Univ. of New Hampshire):
    “It's an example of a government resource that expands available resources in financial markets.” (07:30)
• Potential Fallout:
  If the fund folds, newer or smaller lenders could disappear; rural and red states would lose disproportionately.
  • Quote (Michael Swack):
    “It's hard to say by how much [gaps would widen]. It would be devastating.” (08:04)
• Native CDFI Networks:
  On tribal lands, CDFI is critical for mortgage lending and green energy. Pete Upton is optimistic legal challenges and bipartisan pressure will keep the program alive.
  • Quote (Pete Upton, Native CDFI Network):
    “I think native CDFIs: we're successful because we know the communities that we work within.” (08:17)

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Memorable Quotes

• “We think consumers will be more conservative, more judicious when it comes to how many gifts they purchase.”
  — Gregory Dacko, EY (01:32)

• “That will largely reflect an increase in prices rather than an increase in volumes.”
  — Gregory Dacko, EY (01:49)

• “Prices played a role in it as well. But also volumes or unit sales were strong...”
  — Arun Sundaram, CFRA (02:03)

• “That allows them to protect their margins while still appearing competitive on prices.”
  — Arun Sundaram, CFRA (02:36)

• “India has consistently resisted growing pressure from the US over its Russian oil imports, saying it needs to secure its energy requirements...”
  — Arunde Mukherjee, BBC (03:18)

• “That certification [as a CDFI] helps when we are applying for loans from other funders...”
  — Keith Talley, L Home (06:53)

• “It's an example of a government resource that expands available resources in financial markets.”
  — Michael Swack, University of New Hampshire (07:30)

• “It's hard to say by how much [gaps would widen]. It would be devastating.”
  — Michael Swack (08:04)

• “I think native CDFIs: we're successful because we know the communities that we work within.”
  — Pete Upton, Native CDFI Network (08:17)

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Notable Moments & Timestamps

• 00:57 — Main segment begins: The tone is set for a cautious, slightly spendy holiday shopping season.
• 01:32–02:39 — Expert analysis on consumer trends and retailer adaptation.
• 02:48–04:14 — Geopolitical news: India and Russian oil imports.
• 05:43–08:41 — Deep dive into the CDFI Fund’s imperiled status, its importance, and community impact.

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Final Thoughts

This brisk but information-packed episode delivers a multifaceted update: retailers brace for a value-oriented holiday season shaped by economic divides, with experts expecting more cautious spending but some consumer resilience. Meanwhile, global energy politics remain tense between the U.S. and India, and the critical federal support that empowers small and minority lenders faces existential threat, highlighting the fragility and importance of these programs for America’s underserved communities.

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Transcript

[Dell PC Advertiser]

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[Wix Advertiser]

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[Sabri Benishour]

Black Friday is still a month out, but holiday shopping season is well underway in warehouses and retailer boardrooms across the US From Marketplace, I'm Sabri Benishour in for David Brancaccio. Retailers are getting ready for the most important time of their year holiday shopping season. They have got a lot to deal with tariffs, of course, but also an economy that is split between high income and low income shoppers, Marketplace's Carla Javier reports.

[Gregory Dacko]

The consumer to watch is the cautious one, says Gregory Dacko, chief economist at ey.

[Dell PC Advertiser (Alternate)]

We think consumers will be more conservative, more judicious when it comes to how many gifts they purchase.

[Gregory Dacko]

He and a colleague released a new holiday retail forecast based on income growth, prices, interest rates and consumer confidence. They expect sales to grow modestly, but by 2.5%.

[Dell PC Advertiser (Alternate)]

That will largely reflect an increase in prices rather than an increase in volumes.

[Gregory Dacko]

Analyst Arun Sundaram at CFRA Research is a bit more optimistic, especially about sales volume based on how back to school season went this year.

[Dell PC Advertiser]

Certainly prices played a role in it as well. But also volumes or unit sales were strong, he says.

[Gregory Dacko]

Retailers are adapting to bring in value focused customers. At Target, for example, Sundaram says there will be more entry level pricing, things.

[Dell PC Advertiser]

Like $20 clothing, you know, anything really.

[Gregory Dacko]

That people buy as gifts, especially affordable store brands. And while tariffs make it harder for retailers to offer steep discounts, he says Costco and Walmart will use loyalty data and AI to deliver personalized deals.

[Keith Talley]

And that allows them to protect their.

[Dell PC Advertiser]

Margins while still appearing competitive on prices.

[Gregory Dacko]

Which Sundaram says could result in a good holiday season, even if not a great one. Carla I'm Carla Javier from Marketplace India.

[Sabri Benishour]

Has agreed to stop buying Russian oil, at least that is according to President Donald Trump. The president has pushed India to do this as a way of putting pressure on Russia to end the war in Ukraine, and Trump says he's received assurances from Indian Prime Minister Narendra Modi that India would do this. But that is not quite the story we're hearing from India this morning, which says it will continue to prioritize the country's needs, meaning it may not stop importing from Russia. The BBC's Arunde Mukherjee reports from Delhi.

[Arunde Mukherjee]

India has consistently resisted growing pressure from the US over its Russian oil imports, saying it needs to secure its energy requirements given the rising population and rapidly growing economy. In a statement, the Foreign Ministry indicated, however, that the government was open to diversifying as appropriate to meet market conditions. Reacting to President Trump's remarks, the statement said discussions were ongoing with the US Administration, which they said had shown interest in deepening energy cooperation with India. Delhi has always maintained close ties with Moscow, and Prime Minister Modi for months has stood his ground, citing India's neutral stand in the Russia Ukraine war.

[Gregory Dacko]

Your business is one of a kind.

[Wix Advertiser]

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[Dell PC Advertiser (Alternate)]

Go to wix.com introducing your new Dell PC. Powered by the Intel Core Ultra processor, it helps you handle a lot, even when your holiday to do list gets to be a lot because it's built with an all day battery plus powerful AI features that help you do it all with ease, from editing images to drafting emails to summarizing large documents to multitasking so you can organize your holiday shopping and make custom holiday decor and search for great holiday deals and respond to holiday requests and customer questions and customers requesting custom things. And plan the perfect holiday dinner for vegans, vegetarians, pescatarians and Uncle Mike's carnivore diet. Luckily you can get a PC that helps you do it all faster so that you can get it all done. That's the power of a Dell PC with Intel inside, backed by Dell's price match guarantee. Get yours [e-mail] deals, terms and conditions apply. See Dell.com for details.

[Sabri Benishour]

A federal judge has temporarily blocked the Trump administration from firing thousands of federal workers during the shutdown. Among those the president is attempting to terminate the entire staff of something called the Community Development Financial Institutions Fund. That program supports mission driven lenders operating in rural, tribal and otherwise underserved parts of the country. Last year, it awarded over $400 million in grants and loans to those institutions. Marketplace's Savannah Peters has more.

[Savannah Peters]

In Louisville, Kentucky, entrepreneurs having a hard time raising seed money can turn to a loan fund called L Home.

[Keith Talley]

We work with those small businesses that are simply not in the position to go to traditional banks, usually because of.

[Savannah Peters]

Credit issues, says CEO Keith Talley.

[Keith Talley]

Service businesses, retail restaurants, trucking firms. You name it and we'll take a look at it.

[Savannah Peters]

Lhome is able to work with these borrowers in part because of help from the CDFI fund, Talley says. Elholm has won grants from the fund, but its certification as a government backed CDFI lender matters more.

[Keith Talley]

That certification helps when we are applying for loans from other funders, and they like knowing that there is a third party that's making sure that we, as a cdfi, are lending in the neighborhoods and doing the type of lending that we said we were going to do.

[Savannah Peters]

Without that federal support, Talley says, raising capital to support entrepreneurs in Louisville could get a lot harder.

[Dell PC Advertiser]

The CDFI fund has leveraged a lot of money from the private sector that wouldn't be invested otherwise, says Michael Swack.

[Savannah Peters]

An expert on community lending at the University of New Hampshire who helped get the fund off the ground during the Clinton administration.

[Dell PC Advertiser]

It's an example of a government resource that expands available resources in financial markets, swack says.

[Savannah Peters]

That's why members of both parties have supported the fund for the last 30 years. Plus, he says, states that get the most per capita support are rural and red. Without anyone to run the CDFI fund, SWAC says, some newer and smaller lenders that rely on it would fold. Others would have to scale back in communities where capital is already hard to come by.

[Dell PC Advertiser]

And if the fund were eliminated, these gaps would widen. It's hard to say by how much.

[Dell PC Advertiser (Alternate)]

It would be devastating.

[Savannah Peters]

Pete Upton heads up the Native CDFI Network and says the CDFI fund is a major supporter of everything from mortgage lending to green energy development on tribal lands.

[Keith Talley]

I think native CDFIs we're successful because we know the communities that we work within, upton says.

[Savannah Peters]

They cater their services to native borrowers needs in ways big commercial banks won't. He's hopeful that lawsuits by federal workers unions and pushback from Republicans in Congress can stop the CDFI fund from being eliminated. I'm Savannah Peters for Marketplace, and in.

[Sabri Benishour]

New York, I'm Sabri Benishore with the Marketplace morning Report from 8pm American Public Media.

[Gregory Dacko]

I'm Kimberly Adams, host of Make Me Smart, a podcast from Marketplace that makes today make sense. Join me throughout the week as I dig into the biggest stories in tech culture and the economy. Whether it's a vibe check on the job market or the latest on China US Relations, make Me Smart helps you understand how the headlines actually impact your daily life. Listen to Make Me Smart on your favorite podcast.

[Keith Talley]

Applause.