Donald Trump wants to emulate Vladimir Putin and “govern his own country in a similar fashion”, his former national security adviser has said.

Fiona Hill told Sky News’ The World with Yalda Hakim that the US and Russian presidents both share the same view of the world as being “divided up among three major powers; Russia, the US and China, with very clear spheres of influence”.

She said the two leaders “have shockingly similar world views”.

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“This is the first time we’ve had a US president who wants to emulate the Russian leader in some way, who wants to create a hyper-personalised presidency, who wants to basically govern his own country in a very similar fashion, very top down without any checks and balances,” she said.

Ms Hill added Mr Trump wants to “regularise, normalise and reset” the relationship between the US and Russia.

“That’s very clear, it’s been clear since the first presidency of Trump,” she said.

“He’s always wanted to sit down with Vladimir Putin and sort out all of the difficulties in the bilateral relationship, everything from nuclear issues and nuclear arms reduction – there’s all kinds of economic and business deals that Trump himself and his immediate circle are very interested in.

“That was not the direction of travel of other US presidents. So in actual fact there’s probably more chance under Trump of a close relationship between the US and Putin.”

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Ms Hill said Mr Trump has an interest in forging a “personal relationship” beyond what he already has with Mr Putin.

“He wants to extricate the United States from its support for Ukraine, he’s said that very clearly,” she said.

“He also wants to pull back from the underpinning of European security and get the Europeans to pick up not just support for Ukraine, but also much more involvement and much more in-depth payment for all of their own security, that’s also very clear.

“So there is a strategic perspective there and I think part of the US strategy and the Trump administration strategy is to push the Europeans to go off essentially on their owns in terms of framing what they want in European security and making it very clear to the Ukrainians that they can’t expect much more future support from the United States.”

It comes as Mr Trump claimed a deal to end Russia’s war in Ukraine is “very close”.

Hours after US secretary of state Marco Rubio withdrew from high-level talks in London aimed at ending the conflict, the American president heaped pressure on Volodymyr Zelenskyy to “get it done”.

Global stock markets and the dollar have rallied on hopes of two significant climbdowns by the Trump administration on issues blamed for a slump in values.

Remarks by the US Treasury secretary on punitive tariffs against China lifted the mood on Wall Street initially before the president himself moved to calm market trade war worries and also end speculation he could fire the head of the country’s central bank.

The Dow Jones Industrial Average and tech-focused Nasdaq Composite both ended Tuesday trading 2.7% up, erasing losses of the previous day.

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Asian markets later followed that lead, with the Hang Seng in Hong Kong gaining 2.4%.

European indices also saw a strong opening, with the FTSE 100 up by more than 1.2%. It was led higher by Asia-focused banks HSBC and Standard Chartered.

US futures suggested Wall Street would pick up where it left off, with further strong gains expected.

The US dollar – badly hit by trade war implications in recent weeks – was at least a cent higher than a day earlier against many rival currencies including the pound.

The rally gathered steam on Tuesday evening when US Treasury secretary Scott Bessent told a private JPMorgan event that he expected a “de-escalation” in the spiralling spat with China.

It’s a fight that has seen US tariffs hit 145% and China responding with duties of 125%.

According to a transcript obtained by the Associated Press news agency, he told the audience: “Neither side thinks the status quo is sustainable”, but he added that peace talks were yet to start in earnest and could take time to bear fruit.

His boss later struck a similar tone in remarks to reporters when he said the final tariff rate with China would come down “substantially” from the current 145%.

“It won’t be that high, not going to be that high,” Mr Trump said, adding: “We’re doing fine with China… we’re going to live together very happily and ideally work together.”

He gave no hint that he plans to ease wider tariffs on trading partners, including the UK which is currently subject to 25% tariffs on car, steel and aluminium imports and a wider 10% “baseline” tariff.

But the president did row back on an apparent threat, made last week, to sack the chair of the Federal Reserve Jerome Powell in revenge for the US central bank holding off on interest rate cuts that could provide some stimulus to the tariff-hit economy.

Mr Powell has said the Trump administration’s protectionist policies have created uncertainty over growth and the threat of higher inflation.

The president has dismissed those arguments but told reporters: “I have no intention of firing him”.

His comments were widely seen as an attempt to calm financial market concerns that the independence of the country’s central bank was under threat.

Analysts cautioned there was a long way to go to recover values seen before the start of the trade war, with the Nasdaq remaining almost 16% down in the year to date alone.

US government borrowing costs also remain elevated.

Not helping sentiment were big downgrades to global growth forecasts by the International Monetary Fund on Tuesday.

Michael Brown, senior research strategist at Pepperstone, said of the investor mood: “Participants understandably remain jittery, not only as the haven value of both Treasuries and the USD (US dollar) continue to be called into question, but also as a huge degree of trade uncertainty continues to linger.

“As a reminder, the whole concept of ’90 deals in 90 days’ is currently running at ‘0 deals in 14 days’ which, to be frank, doesn’t quite have the same ring to it.”

Tensions between US President Donald Trump and US Federal Reserve chair Jerome Powell have hit a new high.

But why has the pair’s relationship deteriorated so badly? And what are the issues behind their spat?

Sky News correspondents Mark Stone and Paul Kelso take a closer look…

Powell’s independence is a problem for control-obsessed Trump

Mark Stone, US correspondent

The feud between Donald Trump and Jerome Powell is as predictable as it is serious.

Jerome ‘Jay’ Powell holds one of the most powerful and influential positions in the world.

As chair of the US Federal Reserve, he wields the levers which control global economic stability, such is the power of the US dollar.

The position comes with a huge amount of autonomy. Fed independence is seen to be paramount.

For a full-control-obsessed president like Donald Trump, that’s a problem.

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The American president cannot tell the Federal Reserve chair what to do – and that is by design.

But Trump could fire Powell if he chose to – unprecedented as that would be.

You only need to look at the market reaction to Trump’s language about Powell for a hint at how his firing would impact the global economy.

“Powell’s termination can’t come fast enough,” Trump said last week.

On Monday, he called Powell a “major loser”. This schoolyard language has global economic implications.

The markets – including the all-important bond markets – reacted with sell-offs at the end of the day.

Powell is a registered Republican. Trump hired him as Fed Reserve Chair during his first term but the relationship became fractious, fast.

Yet Trump did not remove him back then.

The position has a four-year term and President Joe Biden nominated him to a second term in 2022. That gives him until 2026.

Trump sees Powell increasingly as a barrier to his agenda. Trump’s ‘burn hot’ economy ideology does not align with Powell’s more pragmatic centrist ideology.

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He is unable to influence and bend Powell in the way that he has done with his own cabinet and members of Congress.

In his first term, Trump was talked out of removing Powell. But we know this second term is wholly different. He was talked away from the edge on many issues during his first term. This time, in many areas, he’s jumped.

Remember, Trump forced out two FBI directors – one in each term – because neither was considered to be loyal enough. The FBI, like the Federal Reserve, is considered traditionally to be independent.

Of course, the Federal Reserve has a profound global influence in a way the FBI, as an institution, does not.

The fed chair, with his role in setting interest rates and so much more, is arguably the last powerful, independent pillar of the economic policy structure in the US.

Congress has largely devolved its role to Trump and the executive branch, as illustrated by his tariff plans (which Congress could have influenced but chose not to).

Donald Trump’s removal of Jay Powell and replacement with a compliant loyalist could fundamentally shake the global economy.

Powell is one of the few reliable actors left defending economic stability in the US

Paul Kelso, business and economics correspondent

Donald Trump’s disparagement of Jay Powell as a “major loser” is not the first time he has insulted the man he appointed as chair of the US Federal Reserve in 2018.

The president appears to have had buyer’s remorse from the moment he approved the former investment banker to fill a post that is fundamental to US economic stability.

Trump was calling for the Fed to cut rates and stimulate the economy long before he was re-elected, but online barbs have more consequence when fired from the Oval Office than the campaign trail.

Equivalent to the Governor of the Bank of England, the chair of the Federal Reserve ultimately directs US monetary policy, including the setting of short-term interest rates, with the aim of maintaining high employment and stable inflation.

That makes Powell a crucial figure amid the chaos and incoherence of Trump’s economic policy, which in less than 90 days has shattered the certainties that made America the world’s largest economy, and the dollar the global reserve currency.

The market reaction to Trump’s venting against Powell, and briefing that his administration is considering ways to remove him from office, suggests investors fear it will make a bad situation worse.

As traders returned from the Easter weekend with the president’s criticism of Powell ringing in their ears, the “Trump slump” deepened.

US stocks and the dollar fell, while yields on US Treasuries – the mechanism by which the government borrows money – rose, indicative of falling bond prices as investors dumped US debt.

Gold prices, meanwhile, hit a record $3,500 an ounce as investors piled into what remains the pre-eminent “safe haven” asset in times of uncertainty.

The combination of falling equity, currency and bond prices is a toxic trifecta more usually associated with emerging economies in political crisis, not the mighty United States.

We saw something similar here in 2022, when Liz Truss and Kwasi Kwarteng’s unfunded tax cuts, presented without an independent assessment from the Office for Budget Responsibility, caused a run on the gilt market.

Then it was the Bank of England that stepped in to stabilise the bond market.

What’s happening in the US is both bigger and more consequential.

Trump’s tariff program, seemingly imposed and withdrawn by presidential whim, has already proved disastrous for market sentiment, with expectations of higher inflation and lower growth, at home and globally, set to be confirmed by the International Monetary Fund in Washington this week.

Powell and the Fed are among the few reliable actors in this drama, with markets betting their next meeting in May will see rates held, in part because of inflationary policy made in the White House.

The prospect of Powell being replaced by a more pliant figure hand-picked by Trump would pull another block from the wobbling Jenga tower of US economic credibility.

The independence of the Fed is one of the foundations of American stability, an assumption that underpins the $29 trillion Treasuries market that makes the world’s debt go round.

If investors large and small, state and private, fear that the US is not good for that debt, it could be calamitous for American pre-eminence and the global economy.

Powell’s term ends in 2026 and he believes he cannot be removed by presidential decree.

That does not mean he will not face more pressure to stand aside.