The IT recovery gained fresh momentum with a new survey of CIOs showing increased spending on technology for the rest of the year. A survey of more than 100 North American CIOs by Forrester Research found that technological investments grew in the first quarter of 2004 and will have risen by 2.4% by the end of 2004.

The trend seems likely to continue, says Forrester. About one-third of CIOs expect to exceed their IT budgets for the rest of the year, up from 25% in the first quarter. A further 55% said they were still planning to remain within their budgets, however.

Analysts say that IT budgets are also on the up in Europe, although European CIOs do not yet share the level of optimism of their US counterparts. Tom Pohlmann, one of the analysts who compiled the survey, draws two particular lessons from the statistics: first, that improvements in the wider economy are now directly affecting IT spending; and second, that CIOs are less risk-averse and are buying new technologies.

The survey found that 43% of CIOs overall ranked their business climate as either ‘strong’ or ‘very strong’, an improvement of 7% from the first quarter. At the same time, the number of CIOs describing their business climate as being ‘weak’ or ‘somewhat challenged’ dropped from 37% in the first quarter to 27% in the second quarter. Forrester’s results also show that CIOs are more confident in the service and manufacturing sectors than those in retailing and wholesaling.