Aurelia Butler

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BEIJING (Reuters) -China has banned exports to the U.S. of some goods containing critical minerals while tightening exports on others, after U.S. curbs a day earlier on the Chinese chip industry.Following is background on export controls and other steps that analysts say Chinese authorities might take to safeguard China and its companies’ interests.DUAL-USE On Dec. 3 China banned exports to the U.S. of items related to gallium, germanium, antimony and superhard materials, the latest escalation of trade tensions between the countries ahead of President-elect Donald Trump taking office.China had already on Dec. 1 enforced new regulations on exports of so-called dual-use products that have both civilian and military applications. That had seen it create a unified and simplified export control list while also requiring Chinese exporters of dual-use items to disclose details about end users. The move allows Beijing to better identify supply chain dependencies on China within the U.S. military-industrial complex. Critical minerals are among these items, as China dominates global mining and processing of rare earth materials. It already this year imposed export limits on antimony, a strategic metal used in military applications such as ammunition and infrared missiles, and in October 2023 put curbs on graphite products that go into electric vehicle batteries.In July 2023, China announced restrictions on the export of eight gallium and six germanium products, metals widely used in chipmaking, citing national security interests.In December 2023, China banned the export of technology to make rare earth magnets, which came on top of a ban already in place on exporting technology to extract and separate the critical materials.SECURITY REVIEWS Beijing’s announcement in May last year that it would block some government purchases from Micron (NASDAQ:MU) after the U.S. memory chip maker failed a security review is widely regarded as one of China’s first retaliatory moves in the U.S.-China chip war.Concern has grown that U.S. tech giant Intel (NASDAQ:INTC) could be a future target, after the Cybersecurity Association of China alleged the American firm had “constantly harmed” the country’s national security and interests and that its products sold in China should be subject to a security review.Intel is one of the largest providers of chips used in electronic devices including personal computers, and traditional servers in data centres in China. It received over a quarter of its total revenues from China last year.Retaliatory action could also happen via other channels. U.S. business chambers in China have in past years complained of U.S. firms facing increased issues such as slower customs clearance and more government inspections during times of escalated tensions such as the U.S.-China trade war. UNRELIABLE ENTITIES LIST AND ANTI-FOREIGN SANCTIONS LAWChina in September announced that it would probe U.S. firm PVH Corp (NYSE:PVH), which owns fashion brands Tommy Hilfiger and Calvin Klein, for “unjustly boycotting” Xinjiang cotton and other products under the unreliable entity list (UEL) framework. That was the first time Beijing had taken action against a company for removing Xinjiang cotton from its supply chain to comply with U.S. rules, and one of the few times it had used the UEL since the list’s creation.Beijing created the list during the first Trump presidency and threatened to ban U.S. companies from importing, exporting and investing in China. To date the list has included U.S. companies involved in the sale of arms to Taiwan such as Lockheed Martin (NYSE:LMT) and RTX’s Raytheon (NYSE:RTN) Missiles & Defense.China also has an anti-foreign sanctions law in effect since June 2021, which it uses to target foreign companies that it deems to have harmed the country’s national security or caused Chinese firms to be sanctioned.When U.S. drone manufacturer Skydio was sanctioned under the law in October, that quickly cut off the company’s supply of batteries, according to the Financial Times.”As containment (of China) intensifies, more U.S. industries, businesses and the entire economy will pay an increasingly heavy price,” state-owned outlet Global Times wrote in an opinion article about Skydio in November. More

LONDON (Reuters) – Monetary easing by central banks across developed and emerging economies trundled along in November with markets warily gearing up for a new year that could bring tectonic shifts to the global policy making backdrop.Four of the six central banks overseeing the 10 most heavily traded currencies that held meetings in November lowered their lending benchmarks. Central banks in New Zealand and Sweden each shaved 50 basis points off their interest rates while the U.S. Federal Reserve and the Bank of England delivered 25 bps cuts.Policy makers in Australia and Norway decided to leave interest rates unchanged, while their peers in Switzerland, Japan, Canada and at the European Central Bank held no rate setting meetings. The outcome of the U.S. election, which will see a return of Donald Trump to the White House on January 20, is expected to fuel fresh trade tensions that could boost U.S. inflation and curtail growth. The latest moves come ahead of some potentially sizeable shocks for the global economy, with politics set to become increasingly unpredictable, said James Rossiter, head of global macro strategy at TD Securities.”The name of the game in 2025 is now uncertainty, especially in the U.S. and Europe,” said Rossiter. “Central banks are going to have to adapt their strategies quickly.”The latest moves across G10 central banks brings the year-to-date tally of rate cuts to 650 bps, nearly matching the 2020 total of 655 bps, after major central banks delivered no cuts between 2021 and 2023. Across emerging markets, 12 of the Reuters sample of 18 central banks in developing economies held rate-setting meetings in November. South Korea, Mexico, South Africa and the Czech Republic delivered 25 bps cuts each while China, Indonesia, Turkey, Malaysia, Israel, Hungary and Poland kept rates unchanged. Brazil extended its rate hiking cycle, lifting its key interest rates by 50 bps.S&P Global Ratings emerging market chief economist Elijah Oliveros-Rosen said that a changing outlook of fewer rate cuts from the Fed in the wake of the U.S. election would shape policy making in developing economies. “We also expect greater caution among most major EM central banks, and we’ve therefore toned down our expectations for their interest rate cuts in 2025,” Oliveros-Rosen said in a note to clients. “On balance, we expect a stronger U.S. dollar against most EM currencies in 2025 than in 2024.”The latest moves in emerging markets took the tally of cuts since the start of the year to 1,810 bps across 46 moves – outstripping the total of 1,765 bps of easing in 2022, after 945 bps in 2023. Total (EPA:TTEF) hikes for emerging markets so far in 2024 stood at 1,350 bps.   More

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(Reuters) – The sale of Americans’ private information by “data brokers” to scammers, foreign adversaries, abusive domestic partners and other unscrupulous actors could face stringent new proposed regulations, the top U.S. consumer agency for financial protection announced on Tuesday.If adopted, the proposed new rules would subject “data brokers” to oversight by the Consumer Financial Protection Bureau, requiring them to comply with credit reporting laws, thereby reining in a practice officials say poses threats to national security and public safety.”The scale of this problem is staggering,” CFPB Director Rohit Chopra told reporters ahead of the announcement, citing research according to which some data brokers explicitly advertised the sale of senior national security officials’ personal information.The proposal also comes in the final weeks of President Joe Biden’s administration, meaning its fate will be determined after President-elect Donald Trump, who has pledged sweeping cuts to spending and regulations, takes office in January. Unlike other regulators, CFPB officials have decided to continue rulemaking in the hopes that some new consumer protections may survive the change in administration, Reuters reported last week.CFPB officials said they believed the subject nevertheless enjoyed “broad bipartisan recognition.”Under the proposal, companies that obtain and sell consumers’ personal financial information – such as income data, net worth and credit ratings – would be regulated like credit bureaus and required to maintain safeguards against the misuse of data, to ensure its accuracy and allow consumers to access their own information.The proposal flows from a broader Biden administration concern with personal data use. The Federal Trade Commission in 2022 sued an Idaho company, saying its mobile phone geolocation data could be traced to abortion clinics, churches and addiction treatment facilities.CFPB officials say the unrestricted sale of such data for pennies per person enables espionage, allows thieves to target financially vulnerable people and allows potentially violent actors to target law enforcement officials and others.Officials traced the 2020 murder of a federal judge’s son to a man who had purchased her home address, according to the CFPB.The proposal will be subject to public comment until March 2025. More

Most economists agree that the possible tariffs would impact growth, though views diverge on the effect on consumer prices.Some argue the U.S. trade barriers will push up the value of the dollar, making imports of key commodities more expensive, while likely retaliation from Europe will also raise costs.Cipollone, speaking in a pre-recorded interview at a financial conference, took the opposing view.”All this put together makes me think that we will have a reduction in growth but also a reduction in inflation,” he said. This argument is increasingly relevant since some of the more dovish members of the ECB’s rate-setting Governing Council have been saying that the bank was now at risk of undershooting its 2% inflation target and should therefore cut rates more quickly. Cipollone said that U.S. tariffs would weaken the economy, which translates into lower consumption and thus reduced pressure on prices. Meanwhile, Chinese producers shut out of the U.S. market would be looking for new buyers, selling in Europe at discounted prices.While oil imports could be more expensive given a stronger dollar, Trump also wants to support U.S. energy production, which could mean greater supply just as overall growth cools. These factors will then more than offset the inflationary impact on prices. More