Companies are reducing their IT hardware budgets

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With inflation still on the rise, there have been more and more corporate boards looking to cut capital spending.

As a result, the media has drawn attention to how consumers are handling it all.

Companies have sought to delay big tech purchases that might not be as needed right now, a report from Seeking Alpha says.

Morgan Stanley analyst Erik Woodring reviewed the tech hardware sector and concluded that there will likely be a more cautious approach to major tech purchases in the second half.

According to Woodring, while companies have been working through a backlog of big tech orders for the past 18 months, hardware spending this year is likely to grow at the slowest rate among the major IT spending categories.

The report says there will likely be a 1.8% increase in spending this year compared to 2021. But that comes as spending on communications equipment will rise by 3.4% and services will see an increase of 3.5%.

Woodring said he’s looking more carefully at spending on personal computers, though there’s risk in everything from printers to flash storage and office equipment to other items that officials could cut. of the business budget.

He also added that there are fears of a recession which could add to the cuts.

Amid bad economic news, a sharp rise in prices, combined with lower gasoline prices, could result in a 1% increase in retail sales in June, PYMNTS wrote.

See also: June retail sales rise 1% as lower gasoline prices provide relief to consumers

This could reverse the fall of the previous month, as it also shows more resilience and financial creativity for customers who are short on cash.

The report notes that the July 15 trade report showed the 0.3% decline from May had now been reduced to a 0.1% decline.

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