LOS ALTOS, CA - China's appetite for energy coupled with decisions by leading oil producers not to raise output will inflate energy costs and slow global GDP growth, according to the latest economic report by Henderson Ventures.

The research firm forecasts GDP growth to slow to 3% in 2006, from 4% in 2004, and then rebound to 3.6% in 2007.

Electronics equipment markets are expected to follow suit, Henderson said.

"This year, consumer outlays will be stoked by demand for mobile telephones, flat-screen TVs, low-end PCs and iPods. Increasing per-vehicle content will help automotive electronics manufacturers to achieve respectable growth," Henderson said.

Businesses will spike IT equipment buys, and military electronics will see "muscular gains," largely in the U.S., Henderson said.

Global electronics equipment production is forecast to grow 7.1% percent this year, down from 10.3% in 2004. 2006 and 2007 growth will be 5.6% and 7.7%, respectively, Henderson forecasts.


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