BIARRITZ, FRANCE/BEIJING - The United States and China sought to ease trade war tensions on Monday, with Beijing calling for calm and U.S. President Donald Trump predicting a deal after markets fell in response to new tariffs from both countries.

Trump, speaking on the sidelines of the G7 summit of world leaders in France, said Chinese officials had contacted U.S. trade counterparts overnight and offered to return to the negotiating table.

Vice Premier Liu He, who has been leading the talks with Washington, said on Monday China was willing to resolve the trade dispute through "calm" negotiations and resolutely opposed the escalation of the conflict.

Trump welcomed that language and, days after referring to President Xi Jinping as an enemy, heaped praise on his Chinese counterpart.

"They want calm, and that's a great thing, frankly. And one of the reasons that he's a great leader, President Xi, and one of the reasons that China's a great country is they understand how life works," Trump said.

"China called last night our top trade people and said 'Let’s get back to the table', so we’ll be getting back to the table, and I think they want to do something," he said.

In Beijing, Foreign Ministry spokesman Geng Shuang said he had not heard that a phone call between the two sides had taken place. However, China's Commerce Ministry typically releases statements on trade calls. It did not immediately respond to a request for comment.

The increasingly bitter trade war between the world's two largest economies escalated on Friday, with both sides leveling more tariffs on each other's exports.

Trump announced an additional duty on some $550 billion of targeted Chinese goods, hours after China unveiled retaliatory tariffs on $75 billion worth of U.S. goods.

On Sunday, the White House said Trump regretted not raising the tariffs even more. But the president also appeared to back off of his threat to order U.S. companies out of China.

Liu, speaking at a tech conference in southwest China's Chongqing, said nobody benefited from a trade war.

"We are willing to resolve the issue through consultations and cooperation in a calm attitude and resolutely oppose the escalation of the trade war," Liu, who is Xi's top economic adviser, said, according to a government transcript.

"We believe that the escalation of the trade war is not beneficial for China, the United States, nor to the interests of the people of the world," he said.

The trade war has damaged global growth and raised market fears that the world economy will tip into recession.

Geng, the Chinese Foreign Ministry spokesman, said China would retaliate if Trump enforced the latest U.S. tariffs.

Asked if he would abandon the tariffs, Trump said: "Anything is possible. I can say we are having very meaningful talks, much more meaningful I would say than any time frankly." -Reuters