Canadian holiday shoppers eyeing pricey gifts

By Solarina Ho

TORONTO (Reuters Life!) - Electronic gadgets will be at the top of the holiday gift list this Christmas and toys will also be popular, despite a rash of recalls, according to the Retail Council of Canada.

"Electronics are still very hot -- anything that's an electronic toy, an electronic entertainment device," Diane Brisebois, the president and of the council, said in an interview.

Canadians can expect gifts like cell phones with special functions, MP3 players and laptops under the tree, but those aren't the only expensive items that could be flying off the shelves this Christmas.

Consumers are also expected to buy everything from jewelry to furniture over the holidays.

"We still continue to see home furnishings as a very popular segment from now to Christmas," Brisebois said.

"Often it's because they're doing a lot of entertaining, and it dawns on them that this is something they should and want to do."

Less flashy, but equally popular, are sporting goods. Canadians are becoming more active and this trend is reflected in the growing popularity of health or exercise-related items over the last three to five years.

Children will not be lacking in toys either, despite the recalls over the last several months.

"We don't think the toy recall will affect sales in toys. It may simply change the purchase itself, which is why we're hearing more and more that families are looking at toys differently," said Brisebois.

The toy sector is expected to be very strong, but the emphasis may shift more towards educational toys like videos, electronics and talking books.

"The employment numbers are strong, people feel confident, the economy is solid, and that indicates it should be a good holiday season," said Brisebois, who projects a five percent increase in sales compared with 2006.

Still, the impact of cross-border shopping over the holidays is still unknown. The rise of the Canadian dollar, which has soared to its highest levels since the 19th century, has made U.S. shopping appealing.

"We want Canadians to shop in Canada," said Brisebois.

(Reporting by Solarina Ho; editing by Patricia Reaney)