Describing the nature of America's ongoing trade tension with China as a "little squabble", US President Donald Trump on Tuesday hoped that the world's top two economies would be able reach an agreement.

The President's remarks came as trade war between the US and China escalated after Trump last Friday increased the import duty on Chinese products worth USD 200 billion from 10 per cent to 25 per cent.

He has also started the process of a similar increase on the remaining Chinese imports of over USD 300 billion.

China retaliated by slapping tariffs on USD 60 billion worth of US imports.

"We're having a little squabble with China," Trump told reporters on the South Lawns of the White House before boarding Marine 1.

He said the tension with China stemmed from them "treating us very unfairly and predicted "we will be successful".

"I think it's going to turn out extremely well, we're in a very strong position," Trump said.

The President also described his relationship with President Xi Jinping of China as "extraordinary".

"The relationship I have with President Xi is extraordinary... but he's for China and I'm for the USA. It's very, very simple," he said.

Trump also boasted about the relative health of the US economy.

"Our economy is fantastic. Theirs is not so good," he said of China.

Trump was asked about the talks with China having "collapsed". He rejected that characterisation.

"We have a very good dialogue... it'll always continue. We had a deal that was very close and then they broke it," he said.

The economy is doing very well by every measure, Trump said and he described it as "probably the greatest economy... in the history of our country".

On the Middle East, Trump called The New York Times story on the US preparing plans to send 120,000 troops to the Middle East "fake news". But he did say "I would do it", and would actually send "a hell of a lot more".

The 11th round of talks in Washington ended Friday with no deal, but Chinese Vice Premier Liu He said that the negotiations had not broken down.

Trump has been demanding that China reduce the massive trade deficit which last year climbed to over USD 539 billion. He is also pressing for verifiable measures for protection of intellectual property rights (IPR), technology transfer and more access to American goods to Chinese markets.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)