Trump's threat to escalate US tariffs on Chinese imports contributed to a decline on Wall Street, with stock index futures dropping on concern that companies and workers would likely endure some financial pain.
President Trump said on Air Force One Friday that he is ready to impose tariffs on $267 billion in Chinese goods, on top of the additional $200 billion that he said will likely be hit with tariffs in a matter of days.
The world's two biggest economies have been locked in a months-long trade dispute, with negotiations going nowhere and fears that it could damage the global economy.
If Mr Trump were to follow through with all his threats, his administration ultimately would impose tariffs on $517 billion of Chinese goods.
Global exports increased by 9.8 per cent while its imports rose by 20 per cent compared to the same month past year, according to customs data.
The Ministry of Finance said it will raise export rebate rates for 397 goods, ranging from lubricants to children's books, meaning that firms shipping such products overseas will pay less value-added tax.
The Trump administration may be about to slap tariffs of up to 25 percent on an additional $200 billion in Chinese goods, escalating a confrontation between the world's two biggest economies and likely squeezing United States companies that import everything from handbags to bicycle tires.
The Trump administration is reportedly considering using an Obama-era executive order to slap new sanctions on Chinese entities using cyberattacks to steal USA intellectual property. "I hate to do this, but behind that there is another $267 billion ready to go on short notice if I want".
The world's two largest economies have already applied tariffs to $50 billion of each other's goods. "That changes the equation".
Kudlow, who heads the National Economic Council, told CNBC the administration was still talking with China about trade issues but so far China had not met United States requests.
The last effort at a negotiated solution came in late August with meetings between low-level officials, but nothing came of it.
While U.S. businesses in China do not yet appear to face widespread retaliation, some company officials have said they are bracing for blowback.
Zhang said the impact from United States tariffs on China's exports would likely be limited over the next few months.