SAN FRANCISCO—Market research firm IC Insights Inc. Wednesday (May 29) cut its forecast for 2013 semiconductor market growth to 5 percent from 6 percent, citing tepid first quarter gross domestic product (GDP) estimates in many of the world's largest economies.
Based on preliminary GDP figures from most countries or regions, IC Insights (Scottsdale, Ariz.) said it lowered its own estimate for global GDP to 3 percent from 3.1 percent. The reduction in the worldwide GDP growth forecast was driven by a lower GDP growth forecast for the U.S., which now stands at 2.2 percent, the same rate as in 2012, IC Insights said.
The firm blamed the lowering of the forecast for U.S. GDP growth this year was the beginning of budget sequestration, which has led to large and widespread cuts to government spending since March 1.
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According to IC Insights, the correlation between worldwide GDP growth and IC market growth has been excellent over the past few years. The firm expects this trend to continue in 2013. The most likely range for IC market growth in 2013 is between 3 and 7 percent, according to IC Insights.
IC Insights said its 5 percent chip market growth scenario for 2013 incorporates a 9 percent increase in second half of the year compared to the first half of the year, slightly below the 22-year average. But such a second half increase would be much stronger than what occurred in 2012, when the second half increase was only about 4 percent, the firm said.