The latest 'Global Economic Insights' report by Visa, a company specializing in digital payments, shows that luxury shoppers have become more cautious for the first time since the global financial crisis. It indicates a decline in the number of consumers purchasing luxury goods since the beginning of 2025 after years of continuous growth. According to the report, the percentage of cardholders buying luxury goods in cities like London, Paris, New York, and Singapore has decreased compared to last year, due to factors including economic challenges, trade disruptions, and exchange rate fluctuations, which negatively impacted consumer confidence. However, Dubai has been an exception to this global trend, maintaining strong demand for luxury goods and becoming the world's top-performing destination in the luxury sector. One in nine residents purchases a luxury item every three months, a rate that far exceeds that of other major cities. The report attributes this to a broad base of wealthy households, with over 37% of the population earning more than $150,000 annually, supporting sustained demand for luxury goods in the city. The report also notes that luxury shopping is no longer exclusive to the super-rich and the elite, who represent the top 1% of spenders. Visa data indicates that the appeal of luxury has expanded to include broader segments of society, encompassing the affluent (top 5%), the new rich (top 10%), and the upper-middle class (top 20%). Mohammed Bardastani, Visa's Senior Economist for Central & Eastern Europe, Middle East & Africa, stated: 'The first half of 2025 has shown that even the most confident consumers worldwide have become somewhat more cautious. However, the long-term outlook for the luxury market remains promising.' He added: 'The momentum Dubai is experiencing solidifies its position as a global luxury destination, underpinned by a broad base of high-income residents, a sustainable flow of tourists, and the entry of new consumer segments into the market, along with the intergenerational transfer of wealth, the luxury sector is expected to continue its development and growth.'
