Inflation, which affects both businesses and consumers, remains at levels not seen for 40 years. The headline consumer price index for June climbed 9.1% from a year earlier and up from the 8.6% pace recorded in May, according to Bureau of Labor Statistics data published July 13. The June reading was the fastest since December 1981. This situation suggests that the Federal Reserve will remain very aggressive in its policy of raising interest rates, which in turn will depress consumption, the first engine of American growth, according to experts.
Recent actions by Apple and Meta Platforms demonstrate their concern for the economy. Big tech appears to be certain that a worldwide recession is imminent. Silicon Valley appears to be anticipating a severe or perhaps savage economic downturn. When the economic numbers are not particularly encouraging, tech companies and venture capital firms, which finance tech startups, do not want to be caught off guard.
In addition, the dollar’s strengthening against other currencies should hurt the revenue that multinationals generate in foreign markets. Big Tech is present in most countries worldwide. Multinationals want to gird for the hit from what Meta Platforms Chief Executive Mark Zuckerberg expects to be “one of the worst downturns that we’ve seen in recent history”. Apple (AAPL) – Get Apple Inc. Report plans to slow the pace of hiring and spending in certain divisions in 2023. According to Bloomberg News, this decision stems from the iPhone maker’s increased caution in uncertain times.
These changes will not affect all teams, since Apple still plans to launch its next big thing, a virtual-reality headset, in 2023. This will be its first big product since 2015. The decision by CEO Tim Cook’s group is a worrying alarm as Apple has always managed to navigate crises without sustaining much of a scratch. The Cupertino, Calif., tech stalwart managed to beat analysts’ financial estimates throughout the covid-19 pandemic and unveiled the iPhone, launched in 2007, as the financial crisis began.