Two weeks ago, US President Donald Trump visited the Chinese capital Beijing for a high-level summit with Chinese President Xi Jinping aimed at easing trade tensions between the two countries, securing new business deals, and leveraging Chinese diplomatic influence to help manage the conflict with Iran.

Trump was accompanied by a delegation of top US chief executives in an effort to push China to open its markets to American technology companies, and he succeeded in securing several multi-billion-dollar agreements.

The summit resulted in a limited tactical easing and a relative improvement in diplomatic relations between the two rival powers, with the White House stating that Xi Jinping still opposes the militarization of the Strait of Hormuz.

However, Trump’s visit saw a clear failure, as the talks in Beijing did not produce a formal agreement or long-term trade truce regarding China easing restrictions on rare earth exports.

According to an opinion article published this week by the US military newspaper Stars and Stripes, China “can paralyze the US drone fleet with a single phone call.”

Last November, Beijing confirmed that the broad restrictions it had previously imposed on rare earth exports remain in place, including a complete ban on rare earth extraction and separation technologies, in addition to quantitative restrictions on certain critical minerals such as tungsten, bismuth, and antimony, as well as medium and heavy rare earth elements.

China had temporarily suspended a second wave of restrictions that required export licenses for foreign entities and products containing small amounts of Chinese rare earth materials in October 2025, but only for one year.

An analysis by BMI Research, a Fitch Group unit, showed that Xi Jinping’s team merely promised to address US supply shortage concerns without offering structural extensions or concrete policy adjustments during the latest meeting.

Heavy rare earth exports remain restricted

Despite the temporary easing period, China’s exports of critical heavy rare earths remain sharply lower, with dysprosium exports currently standing at only 41% of pre-restriction levels, while terbium exports are at 49% and yttrium exports at 42%.

Yttrium prices have surged around fifteenfold due to the severe shortage caused by Chinese restrictions, creating widespread disruptions in US aerospace and semiconductor industries, where the mineral is used as a critical thermal protection and insulation layer.

China supplies around 70% of US yttrium needs, in addition to 100% of its terbium, holmium, and lutetium requirements.

Washington races to build domestic alternatives

China’s near-monopoly influence over the rare earth sector has pushed the United States and its Western allies to urgently search for alternative sources.

Last July, the US Department of Defense agreed to purchase $400 million in preferred shares of MP Materials, making the Pentagon the company’s largest shareholder with a stake of around 15%.

The agreement includes a ten-year purchase contract with guaranteed minimum pricing, ensuring the company’s production is directed toward defense and commercial customers within the United States in order to strengthen the independence of domestic supply chains.

The company is using this funding, along with $1 billion in commercial debt financing provided by JPMorgan Chase and Goldman Sachs, to build a massive rare earth magnet manufacturing complex in Texas.

During the same period, USA Rare Earth signed a non-binding letter of intent with the US Department of Commerce to obtain $1.6 billion in government funding under the CHIPS and Science Act program.

The funding package includes a guaranteed loan worth $1.3 billion in addition to $277 million in federal funding, in exchange for the US government receiving a 10% equity stake along with additional options to purchase future shares.

The investment aims to accelerate mining, processing, and refining operations for heavy rare earth elements at the Round Top project in Texas, with commercial production expected to begin by 2028.

ReElement Technologies is also seeking to strengthen its position within the emerging Western rare earth supply chain through agreements related to heavy mineral processing and alloy production in North America.

The company signed long-term supply agreements with Canada’s Saskatchewan Research Council to provide neodymium-praseodymium, dysprosium, and terbium, in addition to developing metal and alloy production facilities for defense applications in Ohio.

It also signed agreements to source raw materials from projects in Greenland and the US state of Montana as part of an integrated strategy targeting US defense and industrial markets.

Europe moves to reduce dependence on China

In Europe, the European Union is seeking to overcome Chinese dominance over rare earths through the Critical Raw Materials Act, which places limits on dependence on any single country within supply chains.

The EU is investing heavily in extraction, processing, and recycling operations within Europe, while also launching a list of strategic projects and signing partnerships with resource-rich Western allied nations.

The European Commission is also implementing coordinated defense strategies through initiatives such as the “Resource EU Plan,” backed by funding of up to €3 billion, aimed at coordinating demand, conducting supply chain stress tests, and carrying out joint purchases of critical minerals among member states.

European law also requires that at least 25% of the EU’s strategic raw materials come from recycling by 2030.

At the same time, European automotive and technology companies are developing products that do not rely on rare earth materials, including a shift toward motors that do not use permanent neodymium-based magnets, such as induction motors and synchronous reluctance motors, particularly in electric vehicles.

Bitcoin fell below the $73,000 level on Thursday after renewed clashes between the United States and Iran weakened risk appetite and pushed traders toward defensive positioning.

The cryptocurrency dropped to around $72,500 before recovering slightly to trade near $73,303 at the time of writing, down 3.54% over the past 24 hours.

The decline came after military operations escalated between Washington and Tehran, threatening the fragile truce and weakening market hopes for a near-term peace agreement.

Iran’s Revolutionary Guard said it had targeted a US air base after the United States carried out strikes against Iranian drones and a launch platform near the Strait of Hormuz.

Sharp deterioration in crypto market sentiment

The decline also coincided with a clear deterioration in cryptocurrency market sentiment, as the Crypto Fear & Greed Index fell to 22, returning to the “extreme fear” zone.

Market data showed that more than 166,000 traders were liquidated over the past 24 hours, with total liquidations reaching around $932 million.

Hormuz tensions pressure high-risk assets

The conflict linked to the Strait of Hormuz remains a major concern for markets given its importance as one of the world’s key oil shipping routes.

Oil prices rose again following the latest strikes, recovering part of their previous losses tied to reports of progress in peace talks.

Brent crude climbed around 2.5% to $96.63 per barrel, while US West Texas Intermediate crude rose to around $90.93.

The rise reflects continued market pricing of risks related to disruptions in energy flows, even as prices remain below the highs recorded earlier in the conflict.

The White House also rejected Iranian media reports about a draft understanding that would involve lifting the US naval blockade in exchange for Iran restoring commercial shipping traffic through the Strait of Hormuz within one month, describing those reports as “incorrect.”

US President Donald Trump confirmed that he would not rush into an agreement, warning that Iranian attempts to prolong negotiations would not change his position.

Bitcoin loses a key support level

From a technical perspective, Bitcoin’s structure deteriorated after losing support at the $74,000 level, which has now turned into short-term resistance.

Traders are watching whether the cryptocurrency can reclaim that level to ease selling pressure.

Crypto analyst Ted said Bitcoin failed to hold above the $81,453 level before falling below $78,921 and then breaking beneath the $75,000 barrier, reflecting short-term seller dominance after the recovery attempt failed.

The first support level is currently located between $73,300 and $73,400, the range where Bitcoin is currently trading.

If buyers fail to defend that area, the next major support lies near $70,671.

A break below that level could open the way toward the demand zone between $66,318 and $65,816.

Key resistance levels

On the upside, Bitcoin needs to move back above the $75,000 level before any stronger recovery can begin.

After that, resistance appears near $78,921 and then $81,453.

Analysts believe a daily close above $81,453 could improve the short-term technical outlook and reopen the path toward the $84,000-$85,000 range.

Higher resistance levels are located near $90,235 and then $97,899, although they are not currently viewed as active targets unless Bitcoin first regains the nearer resistance zones.

Slowing network activity raises concerns

On-chain data also showed declining Bitcoin network activity, with the number of active addresses falling 39.8% over two weeks, from 821,000 addresses to just 494,000, according to data published by analyst Ali Martinez.

Declining activity during periods of price consolidation often points to weaker participation from short-term traders.

At the same time, Binance data showed spot buying volumes have been declining for months, meaning fewer traders are aggressively purchasing Bitcoin at market prices, reflecting weak spot demand during the recent recovery attempt.

Forced liquidation risks remain elevated

Funding rates on Binance have returned to positive territory, signaling that derivatives traders still lean toward long positions despite weak price momentum.

When leveraged long positioning rises alongside weak spot demand, the market becomes more vulnerable to forced liquidations.

That was clearly visible in recent trading, as the cryptocurrency market saw nearly $1 billion in liquidations over 24 hours.

Traders believe that if Bitcoin fails to reclaim the $75,000 level, attention will remain focused on the $71,000-$73,000 zone as the key area for potential rebounds.

Oil prices jumped more than 2% on Thursday after Iran’s Revolutionary Guard announced it had targeted a US air base in response to an earlier American attack in the city of Bandar Abbas.

Brent crude futures rose by $2.38, or 2.52%, to $96.67 per barrel by 08:45 GMT, while the more actively traded August contract climbed by $2.45, or 2.66%, to $94.70 per barrel. The July contract is set to expire on Friday.

US West Texas Intermediate crude also rose by $2.24, or 2.53%, to $90.92 per barrel.

Markets pull back from peace deal optimism

The two benchmark crude contracts had fallen more than 5% in the previous session to their lowest levels in a month amid hopes that the United States and Iran could reach an agreement to end the war and reopen the Strait of Hormuz.

However, hours after US President Donald Trump denied reports suggesting he was nearing a settlement agreement with Tehran, Iran’s Revolutionary Guard announced it had targeted a US air base following American strikes against an Iranian drone operation near the Strait of Hormuz, according to a US official.

John Evans, analyst at PVM Oil Associates, said the exchange of airstrikes appeared to be part of the “language of negotiation” between the two sides.

He added that prices may remain volatile as long as hopes for an agreement persist, until falling global inventories begin to have a more visible impact on the market and remind traders of the scale of oil supplies trapped behind the Strait of Hormuz bottleneck.

Tankers leave the strait with tracking systems switched off

Shipping data from LSEG and Kpler showed that two very large crude carriers and one liquefied natural gas tanker left the Strait of Hormuz this week after switching off their tracking systems and are currently heading toward India and China.

US inventories decline

In the United States, data from the American Petroleum Institute showed crude oil inventories fell by 2.8 million barrels last week, marking the sixth consecutive weekly decline.

Official inventory data from the US Energy Information Administration is scheduled for release on Thursday after being delayed by one day due to the Memorial Day holiday on Monday.

Gold prices fell in European trading on Thursday to their lowest levels in two months, deepening losses for the third consecutive session under pressure from a stronger US dollar and rising global oil prices, amid escalating military tensions between the United States and Iran in the Strait of Hormuz, threatening the collapse of peace negotiations between the two sides in Doha.

More hawkish comments from several Federal Reserve officials strengthened expectations that US interest rates could be raised at least once this year, as investors await more key economic data on growth and inflation in the United States.

Price Overview

• Gold prices today: Gold prices fell 2.0% to $4,366.68, the lowest level since March 26, from the opening level at $4,456.04, and recorded a high of $4,466.58.

• At Wednesday’s settlement, gold prices lost 1.15%, marking the second consecutive daily decline, due to the stronger US dollar amid aggressive comments from Federal Reserve officials.

US dollar

The dollar index jumped more than 0.3% on Thursday, extending gains for the third consecutive session and recording a seven-week high at 99.54 points, reflecting broad strength in the US currency against a basket of major and minor currencies.

As is well known, a stronger US dollar makes gold bullion priced in the currency less attractive to buyers holding other currencies.

The rise in the US currency comes as investors avoid risk and focus on buying the dollar as the preferred safe-haven investment due to escalating military tensions between the United States and Iran in the Strait of Hormuz, threatening the collapse of the peace negotiations in Doha.

Global oil prices

Global oil prices rose by more than 3% on Thursday after the US military carried out new strikes targeting military sites inside Iran, prompting Iran’s Revolutionary Guard to suspend the passage of oil tankers through the Strait of Hormuz.

Latest developments in the Iranian war

• The United States launched new strikes on Iran targeting a military site and missile launch platforms.

• A US official said the American military carried out strikes on an Iranian military site that posed a threat to US forces and navigation in Hormuz.

• The US official described the military operation as calculated and defensive.

• Iran’s Revolutionary Guard said it targeted a US base that served as a launch point for attacks near Bandar Abbas.

• Iranian television reported that four vessels were forced to turn back after attempting to cross the Strait of Hormuz without coordination with Iranian forces.

• Tasnim News Agency said a US tanker attempting to cross the Strait of Hormuz was forced to stop and turn back.

• Kuwait’s General Staff activated air defense systems after detecting and intercepting hostile missile and drone attacks in the region.

• The escalation of these violations could trigger a severe diplomatic crisis threatening the collapse of the ongoing negotiations in Doha.

• US President Donald Trump rejected Iranian reports claiming an agreement exists.

• Iranian media reported that the agreement would restore shipping traffic through the Strait of Hormuz.

• Trump denied the existence of any agreement regarding the Strait of Hormuz with Iran and Oman.

• Iran insists on easing economic sanctions and preserving its nuclear rights, while the two sides remain far apart.

• The US Treasury Department imposed sanctions on the Iranian authority established to manage shipping traffic through the strait.

US interest rates

• Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, said fighting inflation remains the priority, as the labor market is “in a good place.”

• Austan Goolsbee, President of the Federal Reserve Bank of Chicago, said energy inflation is proving more persistent than expected.

• According to the CME Group’s FedWatch tool, markets are currently pricing in a 54% probability that the Federal Reserve will raise interest rates in December, compared to just over 16% at the beginning of May.

• Markets are currently pricing a 99% probability that US interest rates will remain unchanged at the June meeting, while the probability of a 25 basis point rate hike stands at 1%.

• Investors will later today monitor US first-quarter economic growth data, in addition to the April personal consumption expenditures report, in order to reassess those expectations.

Gold outlook

Peter Grant, vice president and senior metals strategist at Zaner Metals, said: “The Middle East remains the biggest driver. There was still some lingering optimism, but as this situation continues, that optimism is fading.”

Grant added that the ongoing conflict in the Middle East is driving global oil prices higher and increasing inflation concerns, which negatively impacts gold prices and other non-yielding assets.

SPDR Fund

Gold holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, remained virtually unchanged on Wednesday for the third consecutive session, keeping total holdings at 1,034.85 metric tons, the lowest level since May 8.