Global IT spending is set to slow down in 2010 on account of a weak euro versus the US dollar, said IT research firm Gartner on Thursday. Gartner said the strengthening US dollar would put downward pressure on US-dollar-denominated IT spending growth thereby curtailing spend.
The forecast may spell concern for India’s IT companies that earn a large portion of their revenue through software exports to US and Europe.
Though global IT spend would still be up by 3.9 per cent in 2010 compared to 2009, it is down from Gartner’s earlier projection of 5.3 per cent rise.
“The European sovereign debt crisis is having an impact on the outlook for IT spending,” said Richard Gordon, research vice-president at Gartner. “The US dollar has strengthened against the euro during the second quarter of 2010, and this trend will likely continue in the second half of 2010, which will put downward pressure on US-dollar-denominated IT spending growth.”
“Our latest IT spending forecast reflects the fact that the global economic outlook is stable but vulnerable to shocks in key regions and industries, which means that IT spending decisions are still scrutinised for value,” Gordon said.