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China agrees to temporarily ease rare-earth export controls, Elon Musk apologizes for lambasting Don͏‌  ͏‌  ͏‌  ͏‌  ͏‌  ͏‌ 
 
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June 12, 2025
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The World Today

Semafor “World Today” map graphic.
  1. China’s trade leverage
  2. US inflation muted
  3. Reserve gold rises
  4. Trump-Musk feud eases
  5. US favorability sinks
  6. SK’s new foreign policy
  7. ‘Vibe hacking’ fears
  8. Gene-editing optimism
  9. Affording children
  10. The Sun’s south pole

How the 18th-century Shakers influenced modern design.

1

US trade deal gives China future leverage

US Treasury Secretary Scott Bessent and Chinese vice premier He Lifeng meet in London.
United States Treasury/Handout via Reuters

China agreed to ease curbs on rare earth exports in a new trade deal with the US, although Beijing left room to resurrect the restrictions if trade tensions escalate. China plans to put a six-month limit on mineral export licenses, The Wall Street Journal reported, ensuring future leverage. In return, the US will relax limits on some manufacturing exports to China. In recent weeks, China’s rare earth restrictions effectively revealed the “world’s pain point,” Bloomberg wrote, giving Beijing a “sword of Damocles” that could hang over future trade negotiations. The deescalation was necessary to avert a supply chain crisis, but the superpowers are merely back “to the already-tense state of affairs from before April 2,” CNN wrote.

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2

Muted tariff impact on US prices

Chart showing US core consumer price index, year-over-year.

US consumer prices rose less than expected in May, suggesting President Donald Trump’s tariffs have so far had a limited impact on inflation. The consumer price index rose 2.4% year-over-year, a moderate increase from April and below economists’ expectations. Firms have warned that tariffs will increase prices, but companies are likely still selling inventory amassed before the duties, analysts said. Others may be delaying price hikes due to trade policy uncertainty, one economist said, adding that higher inflation is still likely in the coming months. The White House again urged the Federal Reserve to cut borrowing costs following the new inflation readout: The Fed will likely leave interest rates unchanged next week, a posture Vice President JD Vance called “monetary malpractice.”

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3

Central banks love gold

Chart showing gold as a share of total reserve holdings among select countries’ central banks.

Gold surpassed the euro to become the second-largest reserve asset for the world’s central banks. The precious metal has long been a leading safe-haven asset, with banks ramping up purchases after Russia’s invasion of Ukraine in 2022, and more recently, as a way to diversify from the US dollar amid the geopolitical and economic uncertainty caused by President Donald Trump’s trade war, Bloomberg wrote. Gold prices have doubled since late 2022, and are forecast to keep climbing, according to both Goldman Sachs and J.P. Morgan. “Central banks aren’t done with gold yet,” one J.P. Morgan analyst said, with shifting US policy and unpredictable global alliances still driving demand for the metal.

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4

Musk regrets anti-Trump comments

Elon Musk in DOGE cap.
Nathan Howard/Reuters

Elon Musk’s feud with US President Donald Trump appears to be cooling. The billionaire tech mogul said he “regrets” some of his posts last week criticizing the president following their very public falling-out amid disagreements over Republicans’ spending package. Musk called Trump before posting the apology, The New York Times reported. Musk’s businesses had already taken a hit: Tesla shares fell as the spat spiraled, and Trump had threatened to cancel billions in government contracts with SpaceX. Musk may be the richest person in the world, but his retreat demonstrated that “ultimately, Donald Trump is running the government,” not his biggest donor, Semafor’s Ben Smith told GZERO Media. “Everyone other than Trump loses in these exchanges.”

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5

US image on world stage deteriorates

Chart showing favorability rating between US and other G7 countries.

The US is viewed less favorably under President Donald Trump than during the last administration, a new Pew Research Center study found. Across 24 nations, Washington’s image notably deteriorated among its neighbors, Mexico and Canada, as well as US allies in Europe and East Asia. Favorability increased modestly in Israel, Nigeria, and Turkey. Trump has upended US foreign policy paradigms since returning to office through his transactional approach and skepticism of traditional alliances — shifts that are expected to define a meeting of the Group of Seven major industrial democracies next week in Canada. “All eyes will be on Trump” at the G7 summit, the Council on Foreign Relations wrote.

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6

South Korea’s shifting foreign policy

South Korea’s President Lee Jae-myung meets with Korean War veterans on Memorial Day.
Jeon Heon-Kyun/Pool via Reuters

South Korea’s new president is already shifting the country’s foreign policy posture, just days into the job. Lee Jae-myung talked with Chinese leader Xi Jinping this week, pledging closer economic ties and asking Beijing to help denuclearize the Korean Peninsula. Lee also ordered South Korea’s military to stop blasting propaganda messages and K-pop through loudspeakers at the border with North Korea. Both moves indicate Lee will pursue a pragmatic and transactional foreign policy approach, tightening ties with China and deescalating tensions with the North, analysts said. But while Beijing greeted Lee’s win “with a mixture of hope and unease,” Pyongyang’s interest in any engagement remains elusive, The Diplomat wrote.

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7

AI malware fears rise

Stock image with digital hacker, and “BAD VIBES” annotation.
Kacper Pempe/Reuters

The rise of artificial intelligence coding agents could spark a wave of “vibe hacking,” as people with no programming skills can simply tell an AI to create malware for them. AI is increasingly capable at writing code: Using so-called vibe coding, “anyone can spit out a Python script using ChatGPT now,” Wired noted. And since at least 2023, AI models that are able to generate viruses and other malicious code have been circulating on hacker forums. So far, they appear largely unsophisticated, but “AI-assisted hackers are a major fear in the cybersecurity industry,” Wired wrote: Soon it may be possible to create malware that uses AI “to rewrite itself as it learns and adapts.”

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Plug
Semafor Cannes newsletter graphic.

Semafor’s Ben Smith and Max Tani will be in Cannes to cover media and marketing’s biggest annual gathering, where many of the most powerful people in media come to make deals, rub shoulders, win awards, and sip Aperol spritzes on the Côte d’Azur.

Starting June 16, they’ll deliver news, scoops, and insights on the year ahead in media — with all its deal-making, gossip, and pretentious grandeur, from one of the industry’s true epicenters.

Subscribe to our pop-up newsletter, Semafor Cannes.

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8

Gene-editing may help treat kidney disease

Doctors may be able to repair some of the damage done by a fatal form of kidney disease using gene editing, despite having been previously believed to be irreversible. Polycystic kidney disease often goes unnoticed for years, quietly doing extensive harm until it eventually causes organ failure and patients require dialysis or transplants. Now, researchers used CRISPR editing tools to deliver viruses to correct the gene that causes the disease in mice, leading to improvements in some symptoms. Gene-editing therapy is increasingly powerful: Regulators have approved such treatments for blood conditions like sickle-cell anemia, and earlier this month, a baby was discharged from a US hospital after receiving personalized gene therapy to resolve a potentially fatal liver disease.

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9

Affordability crisis hurts global birth rates

World choropleth map showing the average age of mothers at childbirth by country, for 2023.

The global collapse in birth rates is largely caused by people not being able to afford the family they want, the United Nations said. Often described as a “fertility crisis,” just 12% of people included in a 14,000-person, 14-country survey said infertility prevented or would prevent them from having more children, while 39% cited financial worries, and another 19% said housing concerns. The research noted that, until relatively recently, demographers warned of a “population explosion,” with some proposing forced sterilization or contraception to prevent mass hunger, and current anxieties over population decline carry “echoes of last century’s dread”: One UN scientist told the BBC that countries should avoid “enacting any kind of panicky policies” to combat concerns of population collapse.

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10

Seeing the Sun’s south pole

ESA image of the Sun’s south pole.
European Space Agency

A European spacecraft captured the first images and video of the Sun’s south pole, giving clues to the cycle of ebbs and flows in our star’s activity. Every 11 years or so, the Sun’s poles flip in a chaotic realignment of magnetic fields that can produce violent explosions and intense solar activity capable of affecting satellites and radios, and even disrupting power grids. The images, taken by the European Space Agency’s Solar Orbiter, are the closest and most detailed ever taken of the Sun, according to the agency. They will help scientists build more accurate computer models of the star, and in turn improve space weather forecasting, a solar scientist told the BBC: “This is the Holy Grail of solar physics.”

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Flagging

June 12:

  • Russian financial markets close for Russia Day.
  • The International Automotive & Supply Chain Expo begins in Hong Kong.
  • The US Open golf tournament tees off in Pennsylvania.
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Curio
Vitra Design Museum

A new exhibition at the Vitra Design Museum in Germany spotlights the utilitarian aesthetics of an 18th-century Protestant sect known as the Shakers. Featuring both historical artifacts and contemporary work, The Shakers: A World In Making includes examples of heavy wooden furniture, elegant agricultural tools and musical instruments, and even a “future-facing” biodegradable coffin inspired by traditional Shaker basket-weaving methods. The Shakers hold a “unique position within the design canon,” the museum’s curator told Dezeen, having evolved from traditional crafts to eventually influence prominent 20th-century Scandinavian designers: “In many ways, Shaker design anticipated modern aesthetics, though it was entirely unintentional.”

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Semafor Spotlight

Steve Case, the former CEO of AOL, and Jerry Levin, the former CEO of Time Warner.
Chris Hondros via Getty

Warner Bros. Discovery’s split is the latest proof that conglomerates are deeply out of fashion, Semafor’s Liz Hoffman and Rohan Goswami write.

Glomming diverse operations together smooths out profits through business cycles, and it mutualizes economic risk — it also mutualizes scandal, tainting a corporate empire with the real or perceived sins of one subsidiary. And with US President Donald Trump looking for points of leverage, corporate sprawl is a real liability.

Subscribe to Semafor Business, what C-Suites and Wall Street are reading. →

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