An alternative view on why China is increasing export controls on critical materials:
China this week put new export controls on rare earths and other critical minerals needed for US defense and technology production. This step drastically escalates the tariff stand-off with the US and fits neatly into the widespread narrative that China has the upper hand over the US. That narrative is nonsense….
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Conclusion
I’m unsure how China stepping up export controls and provoking President Trump will bring tariffs down. Whether China’s actions are a sign that it has the upper hand in negotiations or not, this will likely escalate the trade war, increasing volatility in global financial markets.
Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He co-founded Incredible Charts and writes the popular Trading Diary and Patient Investor newsletters.
Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.
Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.
He founded PVT Capital (AFSL No. 546090) in May 2023, which offers investment strategy and advice to wholesale clients.