China’s calibrated gray-zone pressure on Taiwan—sustained coast guard patrols east of the island, normalized naval presence, and reduced but steady ADIZ incursions—has not escalated into the large-scale amphibious preparations or blockade drills that would signal imminent invasion. Taiwan’s 2026 defense budget approvals, expanded drone and asymmetric capabilities, and Han Kuang exercises incorporating lessons from Ukraine have reinforced deterrence, while U.S. maritime cooperation and diplomatic engagement continue to raise the costs of kinetic action. Official statements from Beijing emphasize “peaceful unification” alongside routine military activity, and analysts note the PLA still lacks demonstrated capacity for sustained multi-domain landings. Traders therefore price the risk of full-scale invasion before the end of 2027 as low, reflecting the absence of triggering developments within the current resolution window.