US Expands Semiconductor Export Restrictions to China

The Biden-era chip curbs have been tightened further by the current administration, with the Commerce Department adding 28 Chinese entities to its export control list. The new rules restrict the sale of advanced GPUs and memory chips used in AI training clusters, effectively cutting off Huawei and SMIC from high-bandwidth memory components. The move is framed as a national security measure to prevent military AI development. Analysts at Goldman Sachs estimate the restrictions could shave 0.3% off China's GDP growth this year.

Beijing responded swiftly, summoning the US ambassador and announcing retaliatory controls on rare earth exports critical to EV batteries and defense electronics. The standoff has rattled semiconductor stocks globally, with NVIDIA falling 4.2% in premarket trading. Taiwan's government called for calm, noting that TSMC's export licenses remain unaffected for now.