(CNN) US policy towards North Korea has entered an unpredictable new era, analysts say, after the rogue state announced it had tested a missile which could hit "anywhere in the world."

Adam Mount, senior fellow at the Center for American Progress, said US President Donald Trump had few good options to respond to North Korea.

"It's a major threshold ... a really difficult question will be whether Donald Trump feels like he's (been) backed into a corner and doesn't have options short of war," he said.

"I think what we'll have to grapple with in Washington is that none of our tactics or our levers mean the same thing anymore," Mount added.

On Tuesday, North Korea announced on state television it had successfully tested an intercontinental ballistic missile (ICBM) for the first time -- something which has long been seen as a red line in already fraught bilateral relations.

Euan Graham, director of the International Security Program at Sydney's Lowy Institute described the development as a foreign policy failure for the United States, going as far back as the Clinton administration.

"It's a failure that goes beyond any one (US) administration," he said. "An ICBM actually takes the threat (of North Korea) right to the US homeland ... that's the dangerous dynamic that will be a driver for how the US responds," Graham said.

North Korea has repeatedly in the past threatened to attack the United States with a nuclear weapon, which the regime claims it has technical capability to do.

South Korea is working with the US to determine whether or not the missile was an ICBM, according to Cho Han-Gyu, the director of operations at South Korea's Joint Chiefs of Staff.

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Trump in January: 'It won't happen'

For months, there have been suggestions that an ICBM test by North Korea was imminent. In January, North Korean leader Kim Jong Un announced his country's missile program was continuing apace.

"Research and development of the cutting-edge tech weapons are actively progressing and strengthening our defense capabilities," he said.

Then President-elect, Donald Trump responded on Twitter, saying North Korea would not be allowed to create a nuclear weapon capable of hitting the US.

North Korea just stated that it is in the final stages of developing a nuclear weapon capable of reaching parts of the U.S. It won't happen! — Donald J. Trump (@realDonaldTrump) January 2, 2017

"North Korea just started that it is in the final stages of developing a nuclear weapon capable of reaching parts of the US. It won't happen!" he said at the time.

In April, at a celebration of North Korea's "Day of the Sun," a missile was paraded through the capital Pyongyang which one analysts said could have been a type of ICBM

"The US failed to prevent the North Koreans from reprocessing their nuclear material, they failed to prevent them from testing nuclear missiles and now we're at the threshold where the North Koreans has not just a basic missile but seven different types and all surprisingly sophisticated," said Graham.

Learning to live with a nuclear-armed North Korea?

Experts say there are no good options for the Trump administration to deal with a heavily-armed North Korea.

"You can't try to stop North Korea crossing a threshold -- it's already crossed (it). What are the sanctions for? What do we get out of pressuring China or North Korea? I think we need to step back and rethink," Mount said.

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The preferred policy of diplomatic engagement pushed by new South Korean President Moon Jae-in was unlikely to be acceptable "for the time being," according to Mount, while a military strike remained "untenable."

"It would be devastating and against the interests of the United States," he said, referring to the likely enormous loss of life in the South Korean capital Seoul, just across the North Korean border.

Graham said the likely outcome might be learning to live with a nuclear, aggressive North Korea.

"The inevitable end point will be that we do live with a nuclear North Korea with long-range missiles in some form and it is only a matter of time until that bitter pill is swallowed in Washington," he said. "(Either way) we've got no doubt a rocky road for the remainder of this year."

What can China do?

Trump has long advocated a policy of pushing China to pressure with its neighbor and tenuous ally, North Korea. After Tuesday's launch, he even suggested on Twitter they "put a heavy move" on the rogue state

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But in the past week or so the US appears to have returned to a confrontational policy on China as it lost faith in Beijing's ability to put the brakes on Pyongyang.

"I think it's now impossible for the Chinese to argue that they are positively restraining Kim Jong Un. If he has got to the threshold of an ICBM test and claimed that, then it shows he is not threatened by Chinese reactions or any further UN sanctions," Graham said.

"It's a poke in the eye for China."

But Graham said China was also likely to place blame on the United States, saying if only Trump had listened to their calls for the US to back down on South Korean drills in exchange for a freeze on North Korea nuclear and missile program this might not have happened.

"I think the Chinese will try to dodge any blame and say 'We can't control North Korea,'" he said.