Trump announces higher tariffs on Chinese goods

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"Trump has taken the proverbial sledgehammer to the walnut this morning.by threatening to slap a 25 percent tariff on a mind-boggling $525 billion of Chinese goods by this Friday", said Jeffrey Halley, senior market analyst at futures brokerage OANDA in Singapore.

Chinese officials were scheduled to meet their USA counterparts in Washington on Wednesday after meeting in Beijing last week for a round that Treasury Secretary Steven Mnuchin described as "productive".

The scheduled increases are set to go into effect on Friday, assuming a trade deal is not struck when Chinese Vice Premier Liu appears in Washington on Wednesday.

Via Twitter, the president said that insufficient progress in bilateral talks would prompt him to hike duties on certain Chinese goods as early as Friday, which were originally held in abeyance pending the outcome of trade talks.

The two sides have imposed tariffs on $360 billion in two-way trade since previous year. But Trump and Chinese leader Xi Jinping agreed to a truce in December to refrain from further escalation.

There was no immediate reaction from China about Trump's announcement.

The fight between the world's two biggest economies is raising worries about global economic growth.

A team from Beijing is expected to arrive in Washington this week.

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White House officials were unaware on Sunday afternoon whether the tweet would affect those talks.

Trump and the Chinese president will decide after the negotiations this week whether they'll meet to sign off on a pact.

Trump also raised the possibility of imposing a 25 per cent tariff on another US$325 billion in imports from China not now covered.

"He's trying to pressure China into a deal". China retaliated by levying tariffs amounting to some $110 billion on United States goods. The president has continually said America is getting the short end of the stick when it comes to our trade agreements with China.

Tariffs on Chinese goods are paid to the United States by the companies importing the goods; most of those companies are US -based.

Sunday's announcement casts into doubt previous expectations that China and the USA were closing in on a deal to end a months-long trade war that has slowed global growth and disrupted markets.

White House officials have stressed that both sides are eager to wrap up talks; last week, Treasury Secretary Steven Mnuchin told FOX Business that although they still had "more work to do", enforcement mechanisms were "close to done".

US officials, including the president, have often said that while the talks have been going well it was still possible a deal would not be struck.

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