Tech

The euro is recovering but technology prices are not falling

The war in Ukraine triggered significant instability in Europe which, together with the uncertainty about its possible spread to other countries in the area, led to the collapse of the dollar against the euro. It took a war for the US currency to outperform the European one, and this had a notable impact on technology prices, which rose considerably.

I could give many examples, but undoubtedly two of the best known were PS5, which rose 50 euros in Spain by the fall of the euro against the dollar, and the Apple iPhone 14 (all models), which reached the market with a clearly higher price compared to the previous generation. It is understandable, since in the end we live in moments in which the euro was worth only 97 cents.

It didn’t take long for companies to raise technology prices to offset the loss in value of the euro against the dollar, but now that the opposite is happening, they don’t seem to be in a hurry to bring prices back to their previous level. I’m not talking about a minor change, the recovery has been clear, so much so that at the time of writing this article a euro is worth 1.07 dollarsa figure that is very close to the values ​​prior to the start of the war in Ukraine, when it was around 1.15 dollars, although it is true that it is far from the maximum peak of 1.25 dollars that it registered five years ago (February 2018). .

Fortunately some products did not experience a significant price increase with the fall of the euro. Microsoft maintained the prices of the Xbox Series S and Xbox Series X, moving away from Sony’s strategy entirely, and Nintendo followed suit. In the PC components sector we did not see a significant impact either, in fact in the last sales season it was possible to buy processors, graphics cards, RAM memories and SSD drives at very good prices.

Some companies continue to argue that the distribution chain is still “in turmoil”, and that it is impossible to maintain a stable supply level and close contracts with acceptable prices, but the truth is that this clashes with the reality that we are seeing on many frontsAs semiconductor demand and production has stabilized, DRAM and NAND Flash prices are in free fall, and even Sony has said the PS5 shortage is over.

We will see how the situation evolves in the coming months, but the current reality, together with the drop in demand, should end up leading to a notable reduction in prices of technology that were inflated a few months ago.

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