White House economic adviser Larry Kudlow downplayed reports President Donald Trump may implement more tariffs on China as the two nations' trade battle escalates.

"Nothing is set in stone right now," the veteran financial guru and former Ronald Reagan adviser told CNBC.

Bloomberg reported on Monday that the United States is preparing to announce tariffs on all remaining Chinese imports by early December if talks next month between presidents Donald Trump and Xi Jinping fail to ease the trade war.

The list would apply to imports from China that aren't already covered by previous rounds of tariffs, which may be $257 billion using last year's import figures, Bloomberg reported, citing people familiar with the matter.

Though final decisions have not been made, U.S. officials are preparing for such a scenario in case a planned Trump-Xi meeting yields no progress on the sidelines of a Group of 20 summit in Buenos Aires in November, according to the report.

However, "policy talks" will determine whether he imposes additional duties, "not an arbitrary timeline," said Kudlow, who served as the Trump campaign's senior economic adviser.

"It is possible some good positive things could — I say could — come out of President Trump-President Xi talks. It's possible," said Kudlow, who worked as Reagan’s budget deputy between 1981 and 1985.

Kudlow also contended Wednesday that Democratic gains in Congress would hurt financial markets.

"I'm not going to make a prediction I do think part of the uncertainty in stocks is about the election," Kudlow said.

"I think a lot of investors ... are concerned that a big change in Congress would cause a rollback of the chief factors driving in strong economy, lower tax rates for businesses and individuals, deregulation, opening up energy and so forth," said Kudlow. "I think folks are worried about."

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