U.S. president Donald Trump is threatening a further 100 billion dollars' worth of tariffs on Chinese imports. The sanctions would be on top of the 50 billion dollars of tariffs imposed on Wednesday.
In response to that, China threatened to impose increased import duties on 106 key US products. That retaliation, Trump says, was unfair, and that is why he has instructed officials to consider the further tariffs.
But China says the US has picked the wrong target.
"If the US continues with its unilateralism and protectionism in total disregard of the opposition from China and the international community, China will see it through to the end at any cost," Chinese Ministry of Commerce spokesman Gao Feng told reporters.
United Nations Secretary-General Antonio Guterres has voiced his concerns over a trade war ahead of a five-day visit to China:
"Trade wars are always bad for those involved in the trade war and for the international economy as a whole. We need to have international cooperation wherever there is a problem. There must be dialogue."
China's threat of tariffs on a raft of US agricultural imports is causing concern in America's farm belt. Soybean growers would be badly hit by such a response to Trump, who draws a lot of his support from farmers.