US–China–Taiwan

Last updated: September 26, 2026

The Trump-Xi summit delivered ceremonial warmth and a limited diplomatic reprieve but failed to resolve core structural frictions. The primary concrete outcome was a two-month extension of the "Busan agreement" trade truce, pushing its expiry from November 10 to January 2027. While President Trump greeted President Xi with an unprecedented arrival ceremony at Joint Base Andrews, the summit yielded no new agreements beyond the truce, and reported differences persist regarding AI guardrails.

Beijing utilized the lead-up to the summit to exert economic and regulatory leverage, plunging rare-earth magnet exports to the U.S. and imposing new export controls on chemical ingredients shipped to the U.S., Mexico, and Canada. Domestically, China tightened border regulations to link entry and exit more closely to national security. Despite the high-level engagement, China’s ambassador maintained that Beijing has "red lines" on Taiwan and human rights that cannot be crossed, while the Chinese defense ministry urged "extreme caution" regarding U.S. arms sales to Taipei.

Investment implications remain strained by the disconnect between diplomatic pageantry and security realities. The delay of a major Taiwan arms sales announcement—which defense firm Anduril notes is affecting its business—serves as a tactical pause, but the underlying security tension remains acute. This is underscored by a Pentagon investigation into how China obtained F-35 stealth fighter parts and Taiwan's launch of its first international organization to counter Beijing's isolation campaign.

Key variable to watch: Whether the U.S. decision on a new Taiwan arms package triggers a collapse of the extended trade truce before January 2027.

Last updated: September 19, 2026

Beijing is leveraging the September 24 summit between President Trump and President Xi Jinping as diplomatic collateral, threatening cancellation if the U.S. approves new arms sales to Taiwan. While President Trump has dismissed these threats, the U.S. is concurrently weighing the purchase of warships from Japan and South Korea to counter Chinese influence. Regional tensions remain acute, evidenced by a Chinese vessel ramming a Philippine fisheries boat and Taiwan conducting its first joint military drills utilizing multiple attack drones.

The strategic competition over AI has intensified, with Huawei reportedly capturing a larger share of China's AI chip market than Nvidia. In response to security concerns, China has implemented new exit-and-entry rules allowing the government to bar citizens deemed a threat to technology security from leaving the country for up to three years. Conversely, the U.S. is pressuring Mexico to restrict AI hardware exports to China while considering a relaxation of pharmaceutical licensing deals with Beijing.

Investment implications are bifurcated between high-level diplomatic optimism and structural decoupling. The U.S. and China are discussing tariff cuts on American energy and agricultural shipments, and the U.S. is expected to delay new manufacturing tariffs until after the summit. However, China has reduced its U.S. Treasury holdings to the lowest level since 2008, and U.S. allies in Asia are expressing anxiety that Washington may trade Taiwan's security for economic concessions.

Key variable to watch: Whether the outcomes of the September 24 summit and the Treasury Secretary's meetings on AI and rare earths stabilize trade relations or accelerate structural decoupling.

Last updated: September 12, 2026

Beijing expanded its maritime pressure this week by launching the first reported Coast Guard patrols along Taiwan’s Pacific coast to normalize operations near eastern approaches, signaling a potential shift toward blockade capabilities. Simultaneously, China leveraged diplomatic and economic pressure against regional partners, threatening a boycott of a South Korean art exhibition and implementing anti-dumping deposits up to 99.2% on Japanese imports of dichlorosilane, a key semiconductor chemical. In response to expanding Chinese airpower, the U.S. Navy introduced the AIM-424 Malice air-to-air missile.

Diplomatic engagement is accelerating alongside these tensions, with President Xi Jinping scheduled to lead a delegation of business leaders to Washington for a summit with President Trump on September 24. The U.S. and China have agreed to an intergovernmental dialogue on artificial intelligence, though Treasury Secretary Scott Bessent warned that U.S. defenses would be irrelevant if China wins the AI race. While Washington reports that Beijing remains on track to meet farm-product purchase commitments, judicial friction has intensified with the start of a U.S. trial describing Huawei as a criminal enterprise.

Investment implications are centered on the volatile intersection of a trade truce and targeted technology warfare. Improved business sentiment among U.S. firms in China suggests a short-term stabilization, yet the shift of Renault’s Dacia EV manufacturing to Europe to avoid tariffs highlights ongoing structural decoupling. The weaponization of semiconductor chemicals against Japan and the U.S. focus on AI dominance reinforce the high-risk profile for the global chip supply chain.

Key variable to watch: Whether the September 24 summit and AI dialogues can mitigate the escalation of maritime patrols and judicial conflict.

Last updated: September 05, 2026

Military and economic friction intensified this week as China deployed a record ship swarm around Taiwan and conducted law-enforcement operations in waters east of the island. Taiwan responded by proposing $4.6 billion in additional 2026 defense spending for anti-ballistic missiles and 40,000 coastal attack drones, while announcing plans for companies to invest $20 billion in the United States. Conflict has also expanded into the space domain, with the US Space Force reporting China's rapid development of space-based weapons and satellites capable of capturing other spacecraft.

Economic decoupling accelerated as the US Department of Transport announced a ban on Chinese cars in America, a move supported by a coalition of major automakers citing national security. Treasury Secretary Scott Bessent is actively lobbying G20 members to re-examine trade terms with China to reduce global imbalances. Beijing has countered by halting certain rare earth shipments to the US and implementing security audits of its own military supply chains to increase self-reliance.

Despite these escalations, diplomatic channels remain open ahead of the September summit between Presidents Trump and Xi. High-level engagement includes a tentatively scheduled mid-September AI safety talk and a planned visit by President Xi featuring a delegation of China's largest CEOs. Military-to-military communication also saw a first-time meeting between the Chinese general responsible for Taiwan and Admiral Samuel Paparo.

Investment implications center on heightened volatility for the automotive and rare earth sectors following the US vehicle ban and Chinese shipment halts. The surge in Taiwanese asymmetric defense spending reinforces long-term demand for drone technology and missile defense systems. Furthermore, the reported withdrawal of global asset managers from China suggests a deepening institutional pivot away from Chinese equities.

Key variable to watch: Whether the upcoming summit and AI talks can stabilize trade relations or if G20 disputes and maritime frictions trigger further decoupling.

Last updated: August 29, 2026

Strategic friction intensified this week as Washington weighed a new 7.5% tariff on Chinese goods—potentially raising total tariffs to 20%—to counter excess manufacturing capacity. Beijing responded with a "China squeeze" on germanium, which Taiwanese technology insiders warn is actively impacting production. This economic escalation coincides with heightened security concerns following the U.S. exposure of state-sponsored Chinese hacking targeting the Federal Reserve, NASA, and several government departments, although U.S. officials later revised these claims to state agencies were targets rather than successfully breached.

Military tensions shifted toward long-range capabilities and asymmetric warfare. China unveiled hypersonic glide vehicles capable of launching air-to-air weapons to target command-and-control aircraft thousands of miles away and expanded military construction on Yagong Island in the Paracels. In response, Taiwan is aggressively scaling its drone capabilities, with parliament passing a military drone spending plan following a push for a $6.6 billion bill. Furthermore, Taiwanese troops and civilians are preparing for potential Chinese first strikes on the strategically critical Penghu Islands.

Despite these escalations, diplomatic channels remain functional ahead of the September summit between Presidents Trump and Xi. The two nations maintained "Track 1.5" dialogues in Beijing to discuss trade and AI, and China's Foreign Minister met with the U.S. Ambassador. However, internal instability within the PLA is evident, with China ousting four senior military commanders and soliciting public reports of violations within the Rocket Force. Internationally, the EU is signaling a pivot toward a more aggressive regulatory stance, with Germany and the European Commission pressing for tougher actions against Beijing.

Investment implications center on the increasing volatility of the electronics supply chain due to Chinese restrictions on critical minerals like germanium. The shift toward asymmetric warfare in Taiwan suggests sustained demand for drone technology and electronic countermeasures. Additionally, the potential for total tariffs to reach 20% increases the risk profile for U.S. firms with high exposure to Chinese manufacturing.

Key variable to watch: Whether the upcoming September summit stabilizes trade relations or formalizes the current trajectory of tariffs and mineral restrictions.

Last updated: August 22, 2026

The U.S. has accelerated structural decoupling this week, initiating a robotics ban on new foreign-made mobile robots via the FCC and preparing to pressure the Netherlands to block ASML sales to China. Washington is also forcing a binary geopolitical choice on AI technology, requiring partner countries to choose between U.S. and Chinese ecosystems. This technological offensive coincides with a high-level diplomatic window, as the White House confirmed President Xi Jinping will visit the U.S. from September 23 to 25 for a summit with President Trump, skipping the UN General Assembly.

Maritime friction has intensified as China expands its footprint east of Taiwan to establish jurisdiction in the Philippine Sea and proposes transforming South China Sea islands into robotic fortresses. Taiwan has responded by approving a record 2027 defense budget of NT$1.12 trillion ($35.1 billion), an 18% increase. Military tensions remain high, evidenced by a U.S. Navy P-8A Poseidon transit of the Taiwan Strait and a four-day power outage on a U.S. destroyer operating in the South China Sea.

Investment implications center on the hardening of the "chip war" and the expansion of decoupling into robotics, which increases volatility for firms reliant on Chinese components. The surge in Taiwan's defense spending and the integration of civilian infrastructure into combat simulations signal sustained demand for asymmetric defense systems and cybersecurity. Additionally, tightening supplies of raw materials such as prepreg and CCL have led Taiwanese PCB makers to raise quotes, suggesting emerging bottlenecks in electronics supply chains.

Key variable to watch: Whether the upcoming September summit between Presidents Xi and Trump produces a diplomatic reprieve or a formalization of the current structural decoupling.

Last updated: August 15, 2026

Taiwan transitioned from theoretical readiness to active combat simulations this week, completing its largest-ever annual military drills. The exercises integrated civilian contractors and businesses and featured first-time tests of "throttling" mobile internet and restricting 5G services to simulate civilian responses to conflict. Beyond traditional war games, Taipei signaled a shift toward asymmetric warfare, announcing plans to produce 100,000 drones per month by 2030 to create a "drone hellscape" and conducting anti-blockade naval drills to escort merchant ships.

Beijing responded by expanding its maritime footprint and upgrading its hybrid warfare capabilities. China conducted joint naval maneuvers with Indonesia in sensitive waters east of Taiwan and launched an unprecedented autonomous AI-driven cyber attack against Taiwanese government agencies. While China suffered two Long March 7 rocket failures, satellite imagery indicates an increase in missile storage and firing capacity on its most advanced frigate model.

The U.S. is aggressively pursuing structural decoupling, targeting both trade loopholes and critical mineral dependencies. The White House accused over 40 countries, including Japan, Canada, and Mexico, of aiding a "Great Transshipment Scam" to bypass U.S. tariffs, resulting in losses between $19 billion and $26 billion. Simultaneously, the U.S. is supporting an Australian rare earth miner to remove Chinese investors and coordinating with Japan to recover deep-sea minerals from 6,000 meters below sea level.

Investment implications center on a massive escalation in defense spending, with Taiwan's 2027 budget projected to hit a record NT$1.1 trillion ($34.1 billion). The shift toward AI-driven cyber warfare and drone saturation suggests sustained demand for autonomous systems and cybersecurity infrastructure. Furthermore, the U.S. move to force allies into a binary choice regarding AI initiatives and the crackdown on tariff evasion networks increase volatility for global supply chains and firms relying on transshipment hubs.

Key variable to watch: Whether the U.S. successfully forces partner countries to abandon Chinese AI initiatives in favor of Western alternatives.

Last updated: August 08, 2026

Technological and economic decoupling accelerated this week as the U.S. drafted bans on Chinese optical transceivers for AI data centers and SpaceX moved to purge Chinese nationals and components from its supply chain. Beijing responded with retaliatory sanctions on U.S. entities and tightened export controls on drones. This tit-for-tat cycle extends to the legal and regulatory sphere, with China launching a cybersecurity review of Palo Alto Networks and conducting a global tax investigation into overseas capital gains to address a deepening fiscal hole.

Military readiness increased as Taiwan conducted annual Han Kuang war games, featuring drills to defend the Danjiang Bridge chokepoint and the transport of President Lai Ching-te to a command center via armored personnel carrier to demonstrate government continuity. Taiwan's security chief explicitly characterized China's hybrid warfare as a regional test, while a Taiwanese minister noted that integration with U.S. Pacific Command has improved defense readiness. Simultaneously, China intensified maritime pressure through patrols of the Scarborough Shoal and issued a "red line" warning to Japan regarding Taiwan.

Diplomatic efforts to manage these tensions remain fragmented. While Envoy Steve Daines returned to Beijing to finalize the agenda for a September summit between Presidents Trump and Xi, other channels are freezing, evidenced by Beijing declining an official visit from Pentagon Policy Chief Elbridge Colby. Regional friction is broadening as the Philippines seeks Ukrainian drone technology for the South China Sea and Pacific Island ministers debate a joint statement following a Chinese long-range ballistic missile test.

Investment implications center on the deepening volatility for AI infrastructure and tech supply chains as the U.S. targets critical data center components. The escalation of "hybrid warfare" and Taiwan's focus on command flexibility suggest a sustained upward trend in defense spending for autonomous systems and fortress-style infrastructure. Furthermore, the Chinese global tax probe and expanded Stock Connect links indicate a shift toward internal fiscal consolidation and diversifying capital inflows away from Western dependencies.

Key variable to watch: Whether the finalized agenda for the September summit can stabilize the cycle of AI-related export controls and sanctions.

Last updated: August 01, 2026

Technological and economic warfare has intensified as the U.S. administration banned the import of new Chinese humanoid robots, quadruped robots, and connected power inverters to protect the domestic AI buildout. Beijing has labeled these moves as "AI hegemonism" and vowed decisive retaliation, while the U.S. further expanded its forced labor import bans to include 43 additional companies. In response to European sanctions on Russia, China blacklisted 14 European firms, banning them from accessing dual-use goods, while German officials are reportedly identifying Chinese economic vulnerabilities for use in a potential trade war.

Military posturing around Taiwan and the South China Sea has escalated through coordinated maneuvers and new capabilities. The U.S. and Japan conducted joint defense exercises with the Philippines, and the U.S. and Taiwanese coast guards held joint sailing exercises. China countered by expanding Coast Guard operations near Taiwan and revealing the launch of a YJ-20 hypersonic missile from a small destroyer. Simultaneously, Taiwan has shifted toward industrial wartime readiness, conducting drills to test the relocation of arms production in the event of a Chinese attack.

Despite the friction, high-level diplomatic channels remain active to prevent total decoupling. Vice Premier He Lifeng held video calls with U.S. Treasury Secretary Scott Bessent and USTR Greer to discuss trade commitments, while Senator Daines is scheduled to return to Beijing to finalize the agenda for President Xi’s upcoming September summit. The two nations are currently negotiating a ceiling on replacement tariffs, with China claiming an agreement to cap them at 20% against current levels of 12.5%.

Investment implications center on the acceleration of AI-driven robotics bans and the heightened risk of supply chain disruptions as U.S. officials conduct spot inspections of China-linked factories in Vietnam. The pivot toward AI-integrated defense applications, as called for by President Xi, alongside Taiwan's focus on industrial continuity, suggests a long-term shift toward autonomous military spending. Market volatility may increase as the upcoming summit determines whether a tariff ceiling can stabilize trade or if "decisive retaliation" over robotics will trigger new restrictive measures.

Key variable to watch: Whether the finalized agenda for the September summit can resolve the robot import ban and forced labor disputes or further harden the technological divide.

Last updated: July 25, 2026

Military provocations have intensified as China launched two days of live-fire exercises in the Taiwan Strait and conducted naval drills within Japan's Exclusive Economic Zone. Beijing has increased aggression toward the Philippines, engaging in three South China Sea clashes this week, including the use of water cannons and a physical assault on a Philippine sailor. In response, Taiwan is accelerating civil defense readiness, simulating mobile internet disruptions and initiating domestic production of RDX explosives after alleged Chinese interference disrupted overseas procurement.

Diplomatic channels remain open but are strained by targeted economic and technological warfare. Secretary of State Marco Rubio and Foreign Minister Wang Yi held "constructive" talks to prepare for President Xi Jinping's upcoming U.S. visit, even as the U.S. Senate Commerce Committee approved legislation to effectively ban Chinese vehicles and connected-car hardware from the American market. Simultaneously, the U.S. is increasing pressure on China's AI sector, with Trade Representative Greer identifying the distillation of AI models as intellectual property theft.

Investment implications center on escalating trade barriers and retaliatory economic measures. China has imposed export controls on 14 European companies, including Rheinmetall, and is seeking opinions on $30 billion in planned tariff cuts with the U.S. to manage trade tensions. The U.S. is further narrowing China's institutional reach by designating Fudan University and Shanghai Jiao Tong University as threats to national interests, while Sweden has declared mining a national security interest to reduce dependence on Chinese supply chains.

Key variable to watch: Whether the upcoming visit by President Xi and scheduled AI safety talks can offset the impact of the U.S. vehicle ban and ongoing maritime escalations.

Last updated: July 18, 2026

Military tensions have escalated as China conducted new ballistic missile tests and constructed full-scale replicas of a U.S. destroyer and Taiwan's presidential palace for military exercises. While the U.S. Coast Guard has increased its presence in disputed waters to counter aggressive Chinese patrols, Beijing is successfully eroding Taiwan's diplomatic footprint, evidenced by Papua New Guinea closing Taiwan's representative office. Simultaneously, the U.S. and its allies have reaffirmed that China's maritime claims in the South China Sea have no legal basis, a move Beijing continues to reject.

Economic warfare has shifted toward targeted dependencies and resource control. The U.S. is pursuing a forced labor probe with potential action within two weeks and has introduced a Senate bill to reduce reliance on the Chinese pharmaceutical industry. China has countered by launching a new mining investment vehicle to increase overseas mineral control, with the IEA reporting that Chinese rare earth curbs threaten $6.5 trillion of Western industry. Notably, Taiwan reported an 80% profit from a nine-month stock market intervention used to mitigate the impact of U.S. tariffs.

A fragile diplomatic truce is attempting to hold at the leadership level, though it remains decoupled from field operations. The U.S. is restoring Hong Kong's special trade status by terminating its national emergency, and a state visit by President Xi remains on track despite accusations of election meddling. However, U.S. Trade Representative Jamieson Greer has set modest expectations for a September summit, focusing on stability rather than resolution. Meanwhile, President Xi is aggressively expanding China's technological influence, announcing AI cooperation hubs across Africa, ASEAN, Latin America, and BRICS members.

Key variable to watch: Whether the upcoming state visit and September summit can stabilize relations or if U.S. forced labor actions and pharmaceutical decoupling trigger further Chinese countermeasures.

Last updated: July 11, 2026

Beijing has pivoted toward high-profile strategic signaling, characterized by a series of nuclear-capable ballistic missile tests from both land and submarine platforms in the Pacific. These actions, which included a submarine launch with only a few hours of warning to the U.S., are described by Australian officials as destabilizing and by Taiwanese officials as a risk to the existing status quo. Simultaneously, China is expanding its operational capabilities with the first successful sea-based landing of an orbital-class reusable booster.

Regional frictions have intensified as China maintains aggressive coast guard patrols east of Taiwan and reports the "lawful expulsion" of Japanese vessels near the Senkaku Islands. In response, Taiwan has reactivated "anti-communist" ideological classes for military graduates and conducted coast guard trips for foreign lawmakers to counter Chinese pressure. Economic coercion has also expanded, with Beijing stalling critical mineral exports to Japan and detaining two Japanese nationals. Meanwhile, Vietnam is constructing a $4 billion dual-use port at its southernmost tip to mitigate Chinese dominance in the South China Sea.

Despite the military escalation, Beijing is utilizing selective diplomatic and trade concessions to manage the relationship with the U.S. President Xi Jinping agreed to release an imprisoned Christian pastor at the request of President Trump, and China has increased its purchases of U.S. soybeans following a May summit. A high-level meeting between the two leaders is expected around September 24. However, the U.S. continues to tighten restrictions, including a communications regulator's block of DigitalSystem Technology and a pending Senate vote to tighten the ban on Chinese vehicles.

For investors, the shift from economic pressure to overt nuclear and sea-based missile signaling increases the geopolitical risk premium for assets in the Taiwan Strait. The continued use of critical mineral exports as leverage against Japan suggests a persistent vulnerability for high-tech manufacturing dependent on Chinese supply chains. While the scheduled September summit offers a potential diplomatic ceiling, the divergence between high-level rapport and aggressive field operations indicates that military posturing is currently decoupled from diplomatic negotiation.

Key variable to watch: Whether the September 24 meeting between President Trump and President Xi leads to a measurable reduction in Pacific missile tests or a further escalation of maritime confrontations.

Last updated: July 04, 2026

Beijing shifted toward more aggressive economic and military posturing this week, implementing export controls on 60 Japanese entities, including the National Institute for Defense Studies. This coincides with a more assertive maritime stance, as the China Coast Guard increased activity east of Taiwan and ordered two Japanese survey vessels to halt operations in the East China Sea. Simultaneously, China revealed a sixth-generation fighter prototype and President Xi Jinping explicitly linked the Communist Party's goal of global prosperity to the support of a strong military.

The U.S. and Taiwan responded by pivoting toward high-density asymmetric deterrence. A top U.S. diplomat advocated for a "hornet's nest" and "saturation strategy" involving the mass production of democratic drones to deter conflict. In Taiwan, President Lai Ching-te urged military cadets to resist Chinese influence, while the main opposition party stalled government drone industry proposals. This security hardening is mirrored by a shift in private capital, with some Taiwanese business owners moving wealth to Singapore due to perceived political instability.

Diplomatic frictions are broadening beyond the U.S.-China axis. The EU has set an October deadline for China to make progress on reducing the trade deficit, while China's Foreign Ministry pressured Paraguay to align its ties with Taiwan toward Beijing's interests. Regionally, China strengthened ideological ties with North Korea, while Canada and a Japan-South Korea bloc continued to consolidate defense cooperation to counter Beijing's influence.

For investors, the expansion of Chinese export controls against Japanese entities suggests a broadening of the economic war beyond semiconductors into broader dual-use technologies. The U.S. shift toward "drone saturation" signals a move toward high-volume, low-cost defense procurement that may benefit diversified aerospace and robotics contractors. Furthermore, the migration of Taiwanese capital to Singapore indicates a growing risk premium being applied to assets tied to the island's stability.

Key variable to watch: Whether the EU and China reach a trade agreement by the October deadline or if the deficit persists, triggering further European trade restrictions.

Last updated: June 29, 2026

The United States and Taiwan intensified symbolic and military coordination this week, signaled by the inauguration of Taiwan's first nonstop flight to Washington and the execution of a tabletop drill simulating a response to a Chinese maritime blockade. The U.S. government explicitly decoupled its security commitments from broader diplomatic tensions, with a senior diplomat confirming that a planned arms sale to Taiwan will proceed regardless of Beijing's reaction. These moves follow U.S. claims that China is actively attempting to discourage international businesses and states from engaging with Taipei.

China responded by defending its recent patrols off Taiwan’s east coast, dismissing Western alarm over Chinese Coast Guard activity as a mischaracterization of facts. This follows a trend of regional realignment as Canada called for discipline in its China relationship while strengthening defense ties with Japan. Simultaneously, Japan and South Korea reaffirmed their shared goal of denuclearization and pledged closer defense cooperation, further consolidating a U.S.-aligned security architecture in the Pacific.

For investors, the shift from general naval exercises to the simulation of a maritime blockade indicates a transition toward more specific contingency planning. While the semiconductor sector remains the primary volatility driver, the U.S. commitment to arms sales regardless of Chinese retaliation suggests a hardening of the security posture that may trigger further asymmetric economic responses from Beijing. The continued strengthening of Japan-South Korea-U.S. ties reduces the likelihood of a fragmented regional response but increases the risk of a coordinated escalation.

Key variable to watch: Whether China implements new economic or diplomatic retaliatory measures in response to the U.S. arms sales and Taiwan's increased direct connectivity to Washington.

Last updated: June 28, 2026

The technology decoupling accelerated this week as the US Commerce Department announced new export controls targeting advanced AI chip architectures, closing loopholes that had allowed certain H100-class hardware to reach Chinese customers via third-country intermediaries. China responded with rare earth export restrictions on dysprosium and terbium — critical inputs for EV motors and wind turbines — in what analysts are reading as a direct counter-lever.

Taiwan Strait military activity remains elevated but below acute crisis levels. PLA naval exercises in the strait's southern corridor continued for the third consecutive week, interpreted by Taipei and Washington as a pressure signal rather than a prelude to action. Taiwan's TSMC announced accelerated expansion of its Arizona fabs, a move widely read as hedging against supply chain disruption risk.

The semiconductor sector remains the primary market expression of this conflict. NVDA, AMD, and ASML all carry material China revenue exposure, and each new export control announcement creates repricing events. The key variable to watch is whether China escalates the rare earth restrictions to include gallium and germanium — a step that would directly impact US defence and semiconductor production.