Trade war: Trump says China "broke the deal" during negotiations

China's Commerce Ministry said in a statement on its website Wednesday it would retaliate with "necessary countermeasures" if the U.S. increased tariffs.

Details: It's comments came as President Trump told supporters at a rally in Panama City Beach, Florida, he was introducing the tariffs because China "broke the deal" in the ongoing trade talks. "[T]he vice premier tomorrow is flying in — good man — but they broke the deal," he said, referring to China's chief negotiator, Liu He, who's due to be in Washington, D.C., Thursday. "They can't do that, so they'll be paying."

Why it matters: Trump has threatened to increase tariffs on Chinese goods from 10% to 25%. His administration has accused China of "reneging" on its trade commitments, per Axios' Jonathan Swan. On top of this, the United States Navy said Thursday a U.S.-guided missile destroyer conducted naval drills with Japan, India and the Philippines in a waterway claimed by China in the contested South China Sea, per Reuters.

The big picture: Trump said he "won't back down until China stops cheating our workers and stealing our jobs." Trump's speech prompted Chris Rupkey, managing director and chief financial economist at global financial group MUFG, to write a note warning of the market dangers of using such rhetoric, CNBC reports.

"We are not sure who the president is addressing tonight in a campaign rally, but he is sure scaring the daylights out of the financial markets."

Go deeper:

• A long trade war with China could backfire on the U.S. and global economy
• Amid trade war, U.S. soybean farmers are getting walloped
• Trump admin. accuses China of "reneging" during trade war
• The world can't afford Trump's China trade war right now