World Semiconductor Trade Statistics, or WSTS, slashed its 2005 growth forecast on chips to 1.2 percent from the previously forecast of 8.5 percent. The expected growth for 2004 is 28.5 precent.

The revised forecast derived after a wave of warnings last week from major chipmakers and chip equipment manufacturers of a future slowdown in demand.

Slower-than-expected consumer demand for high-priced digital electronics such as flat-panel televisions and DVD recorders has prompted consumer electronics makers to trim inventories in recent months, leading to sluggish orders for microchips.

WSTS said the semiconductor market was likely to grow by 3.0 percent in 2006 before expanding by 11.4 percent in 2007.

In June, the organization had forecast a 0.7 percent contraction in 2006, followed by 9.3 percent growth in 2007.

By: DocMemory
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