Mexico is willing to raise tariffs on Chinese goods and find ways to buy more from the US in a bid to avoid duties threatened by President Donald Trump, according to people familiar with the matter.

The U.S. will raise tariffs another 10% on China on Tuesday, citing the flow of illegal drugs into the country, President Trump said. Why it matters: It's an escalation of the growing trade war with one of the U.

The White House is eyeing an end to the de minimis import rule. "U.S. consumers could face larger consequences than meet the eye," the New York Fed wrote.

Deborah Elms, head of trade policy for the Hinrich Foundation, said: “I do not know anyone who anticipated another 10% tariff against China so soon."

Beijing said on Friday it opposed President Donald Trump's latest threat to slap an extra 10% duty on Chinese imports, accusing the U.S. of "shifting the blame" for the flow of fentanyl and promising retaliation to protect its interests.