By Deborah Mary Sophia
(Reuters) -Home Depot Inc warned of slowing demand for home improvement goods this year as inflation dents the ability of customers to spend on remodeling projects, sending its shares down as much as 6% in morning trading on Tuesday.
The No. 1 U.S. home improvement chain forecast annual profit below Street expectations as it increases spending on wages by $1 billion to tackle labor shortages while struggling with higher costs.
Demand for home improvement tools is dropping from pandemic-highs as homeowners become increasingly sensitive to higher prices.
Home Depot said demand for its products such as soft flooring and roofing slowed, even as builders and contractors continued to purchase its big-ticket items such as pipes and fittings.
“We expect this to be a year of moderation in demand for home improvement,” Chief Executive Ted Decker said on a post-earnings call.
“While we don’t…