The luxury market has been experiencing a slowdown as it grapples with persistent macroeconomic headwinds, including inflationary concerns. In recent months, consumers have cut back on discretionary spending, with some opting for second-hand designer wares. In a September 2025 survey conducted by J.P. Morgan Global Research, 60% of consumers across the U.S. and Europe said they use resale platforms to purchase second-hand luxury goods.  

However, green shoots have emerged of late, due to new creative leadership at fashion houses and positive third-quarter earnings from companies including LVMH. “The better reporting from LVMH speaks to a favorable consumer backdrop, with improvements across nationalities, categories and price points. The read-across should be positive for the whole luxury group, with a likely even more favorable read for brands that had gone into the quarter with already very strong momentum,” said Chiara Battistini, head of European Luxury and Sporting Goods at J.P. Morgan.

In light of these changing dynamics, what’s next for the luxury market across global regions? 

The US continues to be a bright spot  

On the whole, consumer demand in the U.S. has held up despite prevailing economic uncertainty — and the trend looks set to continue. “We expect North America to once again be the bright spot of this reporting season, with consistent evidence throughout the summer of healthy spending among Americans across income groups, supported by strong equity markets and wealth creation,” Battistini said.  

In recent weeks, however, consumer spending has decelerated. Chase credit card data shows that spending on “other retail” — which includes bags, apparel, footwear and related categories — grew at around +7% over the summer, before slowing to +4% in the first three weeks of September.¹ “This is possibly due to consumers buying ahead of price increases,” Battistini noted.   

Indeed, the full impact of tariffs — and the related inflationary impulses — remains to be seen. “While so far there has been limited price elasticity in the U.S., we caution that things could look quite different should consumers start to experience broad-based inflation,” Battistini added. 

What’s the overall outlook for the luxury market?   

While there are positive signs for the luxury market, challenges remain for both brands and investors navigating the current slowdown, including tougher comps in the fourth quarter.

“Overall, the tone of the conversations we have had over the last couple of weeks with investors in Asia and in Europe is generally more constructive, trying to gauge whether now is a good time to revisit the sector. However, investors are also wondering whether the sector has now run too far in the absence of a material uptick in underlying trends,” Battistini said. “As such, comments on exit rates and current trading should be closely scrutinized to gauge whether an actual improvement of trends could be sustained beyond the comps.”