Economy

Tariff crisis  US-China relations
Sources: China is holding back rare earth metals

Despite the agreement between the White House and Beijing in late October, China continues to restrict the supply of rare earth metals. Bloomberg reports, citing sources.

About a dozen market participants – from consumers and producers to experts – say that China is withholding raw materials that the United States needs to build up its own magnet production. Deliveries of finished magnets have certainly increased, but American companies continue to have difficulty obtaining the necessary raw materials.

Players “simply can’t get material out of China,” says Scott Dunn, CEO of magnet manufacturer Noveon Magnetics. The world outside China can produce 50,000 tons of magnets, but there is nowhere near enough rare earth metals to support that production, he says.

“China is restricting raw materials to a much greater extent than magnets to maintain that momentum,” says Dunn.

The White House has declined to comment on the data, but has said in recent weeks that China is complying with the agreement. China's Commerce Ministry says that variations in monthly statistics are "normal" and that the country is committed to maintaining stability in global supply chains.

Political situation in Japan
Record-sized budget expected in Japan despite high inflation

The Japanese government led by Prime Minister Sanae Takaichi is expected to present a record-sized budget for the fiscal year 2026, Reuters reports.

The budget for next year, which starts in April, will amount to the equivalent of $786 billion, an increase of 6.3 percent from the previous fiscal year.

“I mean the budget creates a balance between strengthening the economy and ensuring fiscal sustainability,” she said in a statement.

The government plans to issue government bonds to finance the spending, according to Takaichi. The record-sized budget comes at a time when costs in the economy continue to rise due to persistent inflation that has been at or above 2 percent for more than three years, the news agency notes.