A person briefed on the talks said that Trump's advisers were concerned that accepting a meeting invitation at this stage would raise unfounded expectations for a quick deal and erode USA leverage in the talks, where the two sides remain far apart on core structural intellectual property issues.
Trade Representative Robert Lighthizer and other U.S. officials are scheduled to go to Beijing next week to again meet with their Chinese counterparts.
The two sides have three weeks before USA duty rates on many Chinese goods are due to jump sharply, which economists say could further weaken the global economy.
CNBC reported that the tariffs were likely to remain at the 10 percent rate. It is also expected that the situation will negatively affect the USA stock market.More news: Larger groups seen crossing border as overall arrests drop
US President Donald Trump (R) and China's President Xi Jinping (L) along with members of their delegations, hold a dinner meeting at the end of the G20 Leaders' Summit in Buenos Aires, on December 01, 2018.
The negative mood sweeping across financial markets late in the trading week continues to highlight how investor sentiment remains extremely sensitive to any changes in the narrative with US-China trade developments.
The news prompted a sharp selloff in US stocks, dashing the optimism that had been building that the countries were progressing toward a deal before tariffs on Chinese imports rise to 25 percent after the March 1 deadline.
There's growing concern among White House officials that Trump could agree to a cosmetic deal that wouldn't address core issues like China's alleged intellectual property theft, according to a person familiar with the talks.
The March crude contract was up seven cents at US$52.71 per barrel and the March natural gas contract was up 2.6 cents at US$2.58 per mmBTU.More news: Solskjaer likens United's Rashford to PSG star Mbappe
Businesses have been planning for the scenario of rising tariffs at the beginning of next month, by rushing imports and stockpiling goods - although that doesn't mean companies are embracing increased duties.
"Retailers are doing our best to mitigate the pain, but raising tariffs on thousands of consumers products causes massive disruption to retailers in an already uncertain environment", Hun Quach, Vice President for International Trade at the Retail Industry Leaders Association, told Supply Chain Dive in an email.
A study released Wednesday by Tariffs Hurt the Heartland, a campaign opposed to tariffs, said an increase to 25% would reduce employment by 934,000 jobs and GDP by 0.37%. S. were still far away on striking a trade deal.
One senior official said the decision not to go ahead with a meeting should not be read as a sign the talks were breaking down.
"They're hoping for more success", he said.More news: Elizabeth Warren makes presidential bid official with call for change