Markets were cautiously optmistic after Trump took a lighter approach to China on Monday. That sentiment lasted a day.

On the campaign trail, Mr Trump promised a 10 per cent to 20 per cent charge on all imported goods and 60 per cent on Chinese products. He also vowed a 25 per cent tariff on all products from Canada and Mexico, and an additional 10 per cent duty on Chinese goods.

Trump underscored his intention to use tariffs, a tax on foreign goods, as a tool of international economic policy and an increasingly vital source of government revenue.