Market & Supply Watch - December 2014

The EBV Analysis of the Market Situation

Buyers of electronic components maintained their optimistic outlook in September, as the global purchasing monthly business confidence index rose for the second straight month to 118.8, which is the highest level since January 2014. Sales of semiconductors worldwide was $28.07 BN, which is up 3% compared to July 2014 and up 10% compared to July 2013. In Europe, the increase was even higher, up 15% compared to July 2013. As you have seen the last couple of weeks/months, the Euro compared to the US Dollar weakened in the range of 6 to 7%, which usually should be a stimulator for the European export industry. Normally this is somewhat negative for the imports, however, we are seeing an oil price, which is at a very low level. (Due to new exploring opportunities like fracking, it is not expected, that there will be huge increases for the coming months) and also many commodities (gold, copper etc.) are at very low levels versus a long-term trend. On a negative note, what is happening in Japan/China needs to be watched very carefully, because the debts are reaching new record highs and as soon as interest rates increase, there could be a turndown because of higher financing costs.

Source: Commerzbank AG - Economic Research

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