US–China Trade Frictions Heighten Global Growth Risks

China's new export restrictions on rare earths and other critical minerals, together with expanded U.S. technology curbs and proposed tariffs, have raised the risk of global supply shocks and significant downside risks to growth, IMF officials said. Ireland's finance minister Paschal Donohoe warned at IMF–World Bank meetings that the export controls could shock global economic activity and urged diplomacy to avoid wider disruption. Federal Reserve Governor Stephen Miran said the tensions increase downside risks and add urgency to moving policy toward a more neutral stance via rate cuts, even as President Trump threatened to raise tariffs to 100% and talks between U.S. and Chinese officials continue. Emerging-market officials, including South Africa's central bank governor and Thailand's deputy central bank governor, warned trade diversion could depress prices elsewhere, hurt local manufacturers and leave limited room to ease policy. World Bank participants at the meetings also emphasized the need for international cooperation and funding for Gaza reconstruction once security conditions allow.