Rare Earths Could Be Pawn in Island Spat... Again

By Heiko Ihle,

Shutterstock photo

As China and Japan continue to ratchet up tensions over a group of disputed islands in the East China Sea, many investors may be wondering how the dispute could affect the marketplace. One potential area for fallout is the market for rare earth elements (REEs): the futuristic sounding group of 17 minerals with unpronounceable names that play a critical role in everything from hybrid cars to flat screen TVs. As discussed in our October edition of the Euro Pacific Capital Global Investor Newsletter , these minerals have shown particular sensitivity to the diplomatic relationship between the two Asian giants. If the current situation deteriorates (as it has this week when several major Chinese banks pulled out of International Monetary Fund events in Tokyo), the REE market may come under intense pressure.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing Commodities
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