Treasury accuses China of 'retreating from commitments' in trade deal, confirms tariff spike

President Trump's tariff threat is a go.

After Trump tweeted Sunday that he would up tariffs on China, U.S. Trade Representative Robert Lighthizer confirmed the revelation in a Monday afternoon announcement. The U.S. will raise tariffs from 10 percent to 25 percent on $200 billion in Chinese goods, Lighthizer said, citing an "erosion of commitments by China." Still, trade negotiations with China will continue on Thursday and Friday, Lighthizer said.

The revelation comes as trade negotiations seemed to be going "very well" between the U.S. and China, as Trump put it two days ago. But Lighthizer pivoted and said China was "retreating from commitments that have already been made" in those negotiations, with Treasury Secretary Steven Mnuchin doubling down and saying China was trying to "renegotiate" already agreed-upon terms.

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Trump's Sunday tweet was riddled with inaccuracies, including that "China has been paying tariffs to the USA," which isn't how tariffs work. Still, it sent Dow Jones Industrial Average futures plummeting, and the market opened down 450 points on Monday. It regained some steam throughout the day, but Dow futures plunged another 300 points on Monday afternoon after Lighthizer's announcement.