Why Asia electronics production are feared to weaken in October

Clue: The US is involved.

Electronics production in Asia may weaken in October, if HSBC Global Research's Asian Electronics Tracker (AET) suggestions are to be believed.

According to a research note from HSBC Global Research, the AET is projected to decrease from 0.4 to 0.1 in October 2014.

This means that electronics production growth will be a touch above its long-term average.

Here's more from HSBC Global Research:

The main reason for the projected slowdown is weaker momentum in prices received by US manufacturers.

Since 2013, the US computers PPI growth started to climb out of negative territory and supported US demand for Asian electronics.

But there are signs that this upward momentum moderated in Q3 2014.

The latest readings of the remaining AET drivers signal headwinds for Asia's electronics industry through year-end 2014.

New orders received in China have yet to strengthen and other US-related indicators, such as electronics inventory growth and the ISM, weakened last month.

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