China’s Ministry of Commerce confirmed Monday that Chinese companies have stopped purchasing U.S. agricultural products after President Donald Trump threatened to impose new tariffs.
The move comes after Trump threatened to slap 10% tariffs on $300 billion worth of Chinese imports from Sept. 1.
“This is a serious violation of the meeting between the heads of state of China and the United States,” the ministry said in a statement.
It added that it would “not rule out” tariffs on newly purchased U.S. agricultural goods after Aug. 3.
All three major stock indexes fell Monday, with the Dow Jones industrial average shedding more than 760 points after China also devalued its currency to a more than 10-year low of below seven to the dollar in a possible bid to soften the blow from U.S. tariffs.
The Dow lost as much as 961 points, or nearly 3%, before recovering to close at 767 down. The S&P 500 lost 87 points and the Nasdaq Composite dropped 278 points.
The new 10% import duties would be on top of 25% tariffs the U.S. already imposed on $250 billion worth of Chinese goods.
The ongoing trade war between the world’s top two economies has sent shockwaves through global markets as a trade deal remains highly elusive.