Iran has successfully tested a new ballistic missile that can carry multiple warheads and travel up to 2,000 kilometers, state media reported Saturday.
Though Iran has said of having missiles in the same range in its arsenal, it was the first time that the Khorramshahr missile was displayed in public.
"We will promote our defensive and military power as much as we deem necessary", Rouhani said.
Iran has said repeatedly that it has no choice but to boost its defences as its regional rivals Israel and Saudi Arabia sign huge arms contracts with Washington and other Western governments. "We seek no one's permission to defend our land".
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The fragile peace between Iran and the United States seems shattered after a brief lull, while the "rogue" nation North Korea has progressively scaled up its rhetoric against America and followed this up with missile and nuclear bomb threats.
Trump has been critical of the 2015 nuclear deal the U.S. and other world powers struck with Iran.
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If, as now appears increasingly likely, he decides that it is not, it could open the way for renewed USA sanctions and perhaps the collapse of the agreement.
Under the 2015 deal, Iran agreed to limit its disputed nuclear program in return for the easing of economic sanctions.
The Republican president said: "We must work together against those who threaten with chaos and terror". It is capable of carrying multiple warheads, state broadcaster Press TV reports.
The move was seen as a defiance to Trump who blasted Iran's leadership in a speech to the United Nations earlier this week.
As part of the nuclear agreement, President Trump has to re-certify the Iran deal to congress every 90 days.
"On the one hand Iran is trying to demonstrate they are the pragmatic rational actor here and maintain unity among the other signatories of the nuclear agreement, even if from the USA side it starts to unravel", Vakil told CNN.
Iran's Revolutionary Guard on Friday unveiled its latest ballistic missile capable of reaching much of the Middle East, including Israel, while the country's president vowed that Tehran would press ahead with its missile program in defiance of USA demands to the contrary.