Secretary Rex Tillerson Ousted

Background:

Rex Tillerson, who served as Secretary of State for 13 months, has been ousted by President Trump.

What has happened:

CIA Director Mike Pompeo has been asked by President Trump to replace Rex Tillerson, pending senate confirmation.
Gina Haspel, the current Deputy Director of the CIA and career intelligence professional, will replace Pompeo; if confirmed, she will be the first woman to run the CIA.

Why it matters:

Mike Pompeo, a three-term congressman, Army Veteran, and Lawyer, is known for his hawkish foreign policy.
Pompeo has been critical of the Iran Nuclear Deal (JCPOA), calling for its rollback.
Pompeo has supported regime change in North Korea and most recently, stated the US would make no concessions to Pyongyang.
In Secretary Pompeo, it appears President Trump will have a Secretary of State who more publicly aligns with his foreign policy vision.

Market Impact:

“Initial reaction to the President’s announcement was Treasury yields, and the Dollar went lower as we saw a very brief ‘flight to quality’ trade. For the most part, markets seem to be ignoring the cabinet change. This reaction is compatible with Rex Tillerson’s less visible role in recent months. “

Peter Tchir, Head of Macro Strategy at Academy Securities

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