Chip price drop raises hopes of end to shortage

STORY: The global chip shortage just might come to an unexpectedly sudden end.

That as a variety of factors threaten to crimp demand.

Rising inflation may cut consumer spending, while lockdowns in China and conflict in Ukraine are also factors watched by analysts.

Now industry experts say there are signs that prices for key chips are already falling.

And that could come as a relief to carmakers and other manufacturers, which have been battered by a shortage of silicon.

One site that tracks graphic chip prices in Europe says they’re now selling for 20% above suggested retail prices - down from an 80% premium earlier.

Softer demand for PCs and smartphones is cutting prices for other types of chips too.

That’s according to industry experts at Summit Insights Group.

Later in the week there may be some more clues, with earnings due from big chipmakers including Intel and Qualcomm.

Such firms are spending billions on new semiconductor factories, raising the possibility that the market could swing from drought to glut.

Carmakers, for one, won't mind that at all.