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The Secretary of State has just announced that the US no longer views the settlements as a breach of international law.

What are the international implications of this decision? Is this a hot topic issue within domestic politics? Does this represent a change in the foreign policy of the Trump administration, or is this a continuation of the same ethos that led to the US embassy in Israel moving from Tel Aviv to Jerusalem?

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    I'd suggest that the implications depend on if this is a step one of a larger plan, or a step by itself. If the latter, someone should be able to answer. If the former we will have to wait. – user19831 Nov 18 '19 at 21:58
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The US position is "back to Reagan" basically,

In 1978, the Jimmy Carter administration concluded that the establishment of civilian settlements was inconsistent with international law. In 1981, President Ronald Reagan disagreed with that conclusion, saying he did not believe the settlements were inherently illegal.

Since then, the US adopted a position of describing the settlements as "illegitimate" - though not "illegal" - and sheltering Israel from condemnatory resolutions on the issue at the United Nations.

However one of the last acts of the Obama administration, at the end of 2016, was to break with US practice by not vetoing a UN resolution that urged an end to illegal Israeli settlements.

President Trump's administration has displayed a much more tolerant attitude towards settlement activity than Mr Obama's.

Mr Pompeo said the Trump administration had studied all sides of the debate and agreed with Reagan.

Other than the US even more overtly supporting Israel now, probably not much has changed as the peace process was basically dead already despite what Trump might say (about his Kushner plan). What the Trump/Kushner peace plan is basically is to give (maximum) legitimacy to the current status quo on the ground.

Even the more diplomatic UN speaks of the "one of [the] lowest points" in the peace process and "dangerous paralysis" thereof, and that was this summer.

Actually there were some reactions in that direction already:

[PA spokesman] Abu Rudeina reiterated that the U.S. administration has totally lost all credibility and no longer has any role in the peace process.

If Trump were to follow in Regan's (first) footsteps, the next thing he'll do is to call all of the Palestinians' organizations terrorists. Also

“Israel and Jordan are the two Palestinian states envisioned and authorized by the United States,” Reagan said.

Trump might declare something similar, if he hasn't done so already.

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