China Announces Tariff Retaliation to Take Effect on June 1

In previous cases, China imposed tit-for-tat penalties immediately. "The U.S. -instigated trade war against China is just a hurdle in China's development process".

China's finance ministry said it plans to set import tariffs ranging from 5 percent to 25 percent on a target list worth about $60 billion.

The retaliation had been expected.

In addition to tariff hikes, China could also use other measures to hit back at the United States, as it imports fewer U.S. products - which limits its ability to match tariffs dollar-for-dollar. The U.S. and other trading partners say such efforts violate Beijing's free-trade commitments.

Kudlow said on Sunday that there was a "strong possibility" Trump will meet Chinese President Xi Jinping at a G20 summit in Japan in late June. The U.S. and China together accounted for some 34 percent of total oil consumption in the first quarter of the year, according to the Paris-based International Energy Agency. "Would be wise for them to act now", he wrote on Twitter. "Fox News Sunday" host Chris Wallace pressed Kudlow about this apparent contradiction on Sunday.

The Trump administration last week announced that it will raise tariffs on $200 billion worth of Chinese imports from 10% to 25%.

Imposing those tariffs would affect a wide range of consumer goods - clothes, shoes, toys and electronics - that have been mostly exempted so far and could prompt steep cost increases that many U.S. citizens would likely notice.

Kudlow also said that China needs to agree to "very strong" enforcement provisions for an eventual deal and said the sticking point was Beijing's reluctance to put into law changes that had been agreed upon.

Trump continued to accuse China of reneging on a trade deal the two countries had been negotiating and threatened the nation with economic pain if the trade war drags on, saying businesses will leave China in droves. But markets there are still higher than analysts had predicted. Trump tweeted that Beijing "had a great deal, nearly completed, & you backed out!"

"It's clear that there is a lot of nervousness around the US-China trade negotiations and concern that it's really deteriorating pretty significantly, and that's impacting all areas of markets", said Kristina Hooper, chief global market strategist at Invesco in NY. Paid for mostly by China, by the way.

"It's clear that there is a lot of nervousness around the U.S".

At the heart of the selloff were shares in major technology companies including Apple Inc as well as chipmakers, manufacturers and retailers that draw large chunks of their revenue from China. Soybean exports to China have plummeted over 90 percent and sales of US soybeans elsewhere failed to make up for the loss.

Trump began the standoff a year ago because of complaints about unfair Chinese trade practices.

"I reckon they will". "You've got to do what you've got to do".

The Shanghai Composite index fell 1% to 2,910.04.

However, Kudlow indicated the tariffs themselves are paid by American importers who receive the products.

Trump defended his trade policy Monday morning in a series of Tweets, both crediting tariffs for economic growth and providing advice for consumers to find ways around paying higher prices. China's Commerce Ministry said it "deeply regrets" the USA decision. And that could grow. 'Once the tariffs go onto cellphones, I mean then you're going to see people scream, ' " she says.