Donald Trump has replaced his national security adviser HR McMaster with foreign policy hawk John Bolton, an explosive appointment that signals a further lurch to the right and points to a White House in turmoil.
The move came only hours after an increasingly bellicose Trump administration said it would impose tariffs on up to $60bn in annual imports from China, unsettling global investors. The benchmark S&P 500 dropped 2.5 per cent on Thursday, its biggest loss since February 8. Asian markets followed the US lower on Friday.
The decision to elevate Mr Bolton marks a further defeat for White House moderates. It came on the same day Rex Tillerson departed the State Department, and follows the resignation of Gary Cohn as director of Mr Trump’s National Economic Council.