Mid-year economic slump could impact chip sales growth

NEW TRIPOLI, USA: Our monthly leading economic indicators are pointing to a psooible weakening of the global economy in mid-2011 resulting in a slowdown in semiconductor revenues. Personal consumption would remain sluggish in the second half of 2011 because of a jobless recovery, further deterioration in credit, and continued weakness in home prices.Source: The Information Network, USA.

The US is the largest consumer electronics market. In 2010, 20 percent of the global consumer electronics revenue came from purchases in the US/Canada, followed by Western Europe with 19%. Weak consumer demand in 2011 would translate to weak chip sales.

Our Global Monthly Proprietary Leading Indicators are supplied as a correlation with semiconductor and semiconductor equipment sales expectations four to six months out, as illustrated in the chart below:Source: The Information Network, USA.