China unveiled on Friday retaliatory tariffs against about $75 billion worth of USA goods, putting an additional 10% on top of existing rates in the latest tit-for-tat exchange in a protracted dispute between the world's top two economies.
After a meeting between Trump and Chinese President Xi Jinping in July, Beijing offered to alter its plans, but talks are now deadlocked over how to enforce any deal.
The trade friction already has slowed United States growth, and undercut the global economy, so the threat of a deterioration sent stock markets falling sharply. That arcane milestone, which means that short-term Treasury bond investments pay more than long-term ones, is seen as a precursor to recession, and triggered an 800-point free fall of the Dow Jones Industrial Average.
Both the S&P 500 and Nasdaq joined in the bloodbath, shedding 1.6% and 1.8%.
London's FTSE 100 and the German DAX also turned negative.
"We don't need China and, frankly, would be far...better off without them".
"Our Country has lost, stupidly, Trillions of Dollars with China over many years". They have stolen our intellectual property at a rate of hundreds of billions of dollars a year and they want to continue.
"As President, I can no longer allow this to happen!" he added.
Trump announced a new ten percent tariff on $300 billion of Chinese goods earlier this month, which will take place later this year.
Agricultural goods, crude oil and small aircraft are among the products being targeted.
Trump is pressing Beijing to narrow its trade surplus and roll back plans for a massive state-led strategy to create global leaders in robotics, electric cars and other technology industries.
Beijing also announced it will reimpose a 25 percent tariff on U.S. autos and a 5 percent tariff on auto parts, also starting December 15.
"We work closely with Customs and Border Protection and all law enforcement and regulatory authorities to monitor for prohibited substances", the spokesperson said.
Friday's announcement, if it applied to goods not already affected by Chinese penalties, would extend tariff hikes to everything China imports from the United States.
Tariffs of 10% and 5% will take effect on two batches of goods on September 1 and December 15.
The Trump administration has imposed a 25% tariff on $250 billion in Chinese imports.
Businesses also expressed concern, with a trade group that represents large retailers criticizing the White House.
He said that talks between the two countries were on schedule and argued that the tariffs were not hurting Americans. They would resist any pressure to close their facilities in China, given the size and importance of that market, Reinsch said.
Stocks plunged in the wake of Mr Trump's morning tweets. However, equities are trading at near-record highs and employment is at its highest level in nearly 50 years.
Wrote Harvard Law professor Lawrence Tribe: 'DONALD TRUMP JUST DECLARED that US companies "are hereby ordered to immediately start looking for an alternative to China, including bringing. your companies HOME and making your products in the United States of America".