Semiconductor Monthly Update Report for June 2006

The latest Semiconductor Monthly Update Report from Future Horizons is out. The Semiconductor Monthly Update Report provides analysis and commentary on the global semiconductor industry. You can purchase the complete report directly from Future Horizons.

Below are some highlights from the report:

  • IC sales for April 2006 were up 1.6% versus the same period last year, down 10.1% versus March 2006 on a run-rate basis, with IC ASPs continuing to be the weak link in the chain, down 21.4% on April 2005.
  • New fab capacity, although still steadily increasing, remains remarkably calm and measured, in this case driven not so much by design, but by a near total lack of confidence in the long-term industry outlook.
  • IC supply and demand has been in near balance since 2Q-2005, however, the balance is not likely to be sustainable.
  • The World Bank raised it’s forecast for global economic growth in 2006 to 3.7% up from its November forecast of 3.2%.
  • The US economy grew 5.3% in the first three months of 2006, the fastest rate in two and a half years and up from initial estimates. Recent figures also showed corporate profits had climbed 23.8% compared with 2005.
  • The ECB remains cautious about the eurozone’s longer-term prospects by downgrading significantly its growth forecasts for 2007 from 2.0% to 1.8% because of the impact of higher oil prices.
  • While this level of annual growth in the UK was still better than it has been for most of the past 18 months, it was disappointing relative to expectations. Industrial production fared worse and fell 1% in April compared with the same month in 2005. Although some of the weakness in industrial production was caused by the volatile energy sector, the failure of manufacturing output to rise contradicts more buoyant impressions of company performance suggested by business surveys in recent weeks.
  • Japan’s economy grew a real annualised 3.1% in the three months to March, according to revised figures released recently, providing further reassurance that Japan was on track to achieve its longest post-war recovery.
  • Beijing gave the go ahead recently for a stronger Chinese currency. Stronger currencies help cut China’s huge trade surpluses with the US by making their exports more expensive in dollar terms.
  • India’s economy grew 9.3% in the quarter ended 31st March from a year earlier, marking a broad display of momentum on par with China’s red-hot growth. India’s recent solid economic performance has increased the prospect of two Asian giants expanding at double-digit rates, spinning off new jobs and buying more of what the world grows and produces. Meanwhile IBM plans to invest nearly US$6 billion in India over the next three years.