Trump: "All options are on the table" for North Korea after missile launch

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Donald Trump has been engaged in a war of words with North Korean leader Kim Jong-un (Source: Getty)

Donald Trump has warned North Korea that "all options are on the table" after Pyongyang launched a missile over Japan.

“The world has received North Korea’s latest message loud and clear: this regime has signalled its contempt for its neighbours, for all members of the United Nations, and for minimum standards of acceptable international behaviour,” the US President said in a statement.

"Threatening and destabilising actions only increase the North Korean regime’s isolation in the region and among all nations of the world. All options are on the table."

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North Korea's latest missile launch has sharply escalated geopolitical tensions after a war of words between Kim Jong-un and Trump eased last week.

Shinzo Abe, the Prime Minister of Japan, called the "reckless action" an "unprecedented, serious and a grave threat to our nation". He told reporters he had spoken with Trump and that the US President was "100 per cent with Japan".

European equity markets posted steep drops today as investors piled into safe haven assets like gold and the yen.

The test came after US and South Korean forces held annual military exercises, which angered North Korea.

The reclusive country's key ally, China, last week said it would stop importing North Korean goods like coal, iron ore and fish. China's foreign minister spokesperson, Hua Chunying, today said the crisis was "approaching a critical juncture", but it could be a turning point to opening up peace talks.