US President Donald Trump accused China on Monday of manipulating its currency as the trade war between the world’s largest economies keeps escalating.

Trump said in a series of tweets, “China dropped the price of their currency to an almost a historic low. It’s called ‘currency manipulation.’ Are you listening to the Federal Reserve? This is a major violation which will greatly weaken China over time.”

Trump has criticized Beijing for “always” using “currency manipulation to steal our businesses and factories, hurt our jobs, depress our workers’ wages and harm our farmers’ prices”, Efe news reported.

PBOC Governor Yi Gang said in a statement that China will “not engage in competitive devaluation and not use the exchange rate for competitive purposes and not use the exchange rate as a tool to deal with external disturbances such as trade disputes.”

Donald Trump’s comments came less than three months after its administration decided not to label China a currency manipulator.

A spokesman with the People’s Bank of China, the country’s central bank, said that the depreciation of the yuan comes as a result of “unilateral trade protectionism as well as expectations of more tariffs on China”, a clear reference to the latest round in the trade war that Washington and Beijing have been engaged in since March 2018.

On Friday, Trump had escalated his trade war with China by announcing that he would impose 10 per cent tariff on another $300 billion of Chinese goods that will take effect September 1, prompting a swift rebuke from Beijing and jolting global financial markets.

“Our representatives have just returned from China where they had constructive talks having to do with a future Trade Deal. We thought we had a deal with China three months ago, but sadly, China decided to re-negotiate the deal prior to signing,” Trump tweeted on Thursday.

Last week, President Trump said that China was supposed to buy “large quantities” of US agricultural products, but did not do so.

China had reportedly denied Trump claims but the Chinese government asked state-owned companies to halt imports of US agricultural products, according to reports.