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Home News Business

Corporate Profit Margins Set to be Squeezed in Coming Months

Companies are bracing for financial shocks as analysts warn of tough times ahead.

Jo MeunierbyJo Meunier
October 11, 2022
in Business
Reading Time: 1 min read
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Corporate Profit Margins Set to be Squeezed in Coming Months

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Corporate America is bracing as macroeconomic issues weigh on profit margins. A stronger dollar, bloated inventory levels and uncertainty over the Federal Reserve’s rate-hiking cycle are all contributing factors, according to analysts. 

In the past six weeks, major bellwether firms have either reduced their forecasts or provided a muted outlook. And others are expected to follow suit. 

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This comes as people are spending less and savings dwindle, as prices for nearly everything continue to soar.

Strategists from Morgan Stanley noted: “Things like inventory, labor costs and other latent expenses are wreaking havoc on cash flow. The market has started to see cracks with some bellwether stocks reporting both top-line and bottom-line misses in recent weeks.”  

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The strong dollar is adding further fuel to the fire, creating challenges for companies that derive substantial revenues from overseas. 

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Source: Bloomberg
Tags: Business
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Jo Meunier

Jo Meunier

Jo is Allwork.Space's Senior Editor for the UK and Europe. Jo has worked within business centre and coworking circles since 2009, researching and contributing written features for numerous industry publications. She reports on the latest market news and delves into local issues with one main objective: to champion the flexible workspace industry and its members.

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