China promptly levied taxes on the same value of United States products.
Fed has raised the benchmark lending rates twice this year, after three increases in 2017, and two more rate hikes are expected this year as the central bank removes stimulus from the economy to keep a lid on inflation.
President Donald Trump has threatened tariffs on all Chinese goods imported by the US.
About $US505 billion ($680.3 billion) of Chinese goods were imported to the US in 2017, leading to a trade deficit of almost $US376 billion ($506.5 billion), US government data showed.
TRUMP TALK: Trump told the TV channel CNBC he was ready to exchange tariffs with China until all of China's exports to the US - worth over $500 billion a year - are hit.
He also said that higher interest rates will strengthen the USA dollar too much, putting the United States at a "disadvantage" while central banks in Europe and Japan keep rates low.
Trump had earlier threatened to target up to $550 billion in Chinese products - a figure that exceeds the $524 billion in goods and services China actually shipped to the United States past year.
The White House has already imposed additional levies of up to 25 percent on $34 billion in Chinese products.
Houston Astros tabbed for MLB All-Star game
The team will be managed by Dave Roberts who is the manager for the Los Angles Dodgers. ET as one player from each league will be awarded the final spot on each roster.
Washington also is now targeting another US$200 billion in imports which see fresh tariffs imposed as soon as September.
State-owned China Global Television Network on Friday posted a video, first spotted by Reuters, seemingly created to undermine support for Trump's trade policies.
ASIA'S DAY: Earlier, before Trump's comments were aired, most Asian markets finished higher.
"I don't want (China) to be scared". So somebody would so 'oh, maybe you shouldn't say that as a president.' I couldn't care less what they say, because my views haven't changed. "But it was very unfair".
"The escalating trade war, if it goes badly, could be a risk for the U.S. economy", Mr Bullard said, adding he understands the policy's objective.
"I'm doing this to do this right thing for our country, we have been ripped off by China for a long time and I told that to President Xi", explained President Trump. On Thursday, Trump said he's "not thrilled" with the rise in borrowing rates. "Because we go up and every time you go up they want to raise rates again, and I don't really-I am not happy about it".
Those comments, plus Trump's criticism of Federal Reserve interest rate hikes, had sent the dollar tumbling against a basket of currencies.
However, the euro, yuan and yen all strengthened against the dollar, with the U.S. currency on track for its worst day of July. Analysts suggest Beijing is willing to let the yuan depreciate the longer the trade war rumbles on.