Toy sales in the UK are expected to exceed a record £3.3 billion this year, with £1.1 billion coming from Christmas sales.
According to figures from the Toy Retailers Association (TRA), an average of £105 will be spent on toys this festive season, with a record 400 million toys forecast to be sold in 2016.
Toy sales also grew by five per cent from January to September compared with the same period last year.
The news comes despite the economic uncertainty following the Brexit vote and an impending inflation that would put a squeeze on household incomes.
The TRA has compiled a Dream Toys list with the help of a panel led by retailers Argos, Boots, Selfridges, Smyths Toys, The Entertainer, TK Maxx and Toys R Us.
Among the list is the recently launched Hatchimals – interactive creatures that eventually “hatch” from an egg in response to a child’s touch – which is already selling out in parts of the UK.
Also on the list is the Snuggles My Dream Puppy and the Shopkins Chef Club Hot Spot Kitchen.
The £20 SelfieMic – a selfie stick with a karaoke microphone so users can create their own music videos – plus family games Speak Out and Silly Sausage, also feature in the list.
A “contactless” version of Monopoly, the Monopoly Ultimate Banking Game, is also predicted to be a best seller.
Last year’s best seller, Pie Face, returns to the list in a version designed for two people.