Turkey doubles tariffs on some United States imports over economy 'attacks'

Turkey doubles tariffs on some United States imports over economy 'attacks'

Turkey doubles tariffs on some United States imports over economy 'attacks'

The pressure on Turkey is reflective of broader trends in emerging markets, although the lira is by far the worst performer.

In addition, Turkey's national airline and its main telecoms firm announced they will halt advertising in the United States media.

Turkish president Recep Tayyip Erdogan has said his country will boycott electronic products made in the USA amid an escalating diplomatic feud with the Trump administration that has helped trigger a currency meltdown in Turkey.

Turkey is in the throes of a full-blown currency crisis, with the Turkish lira losing almost 45 percent of its value since the start of the year.

The Turkish lira rebounded 6% in Tuesday trading, haven fallen 25% in the past month, weighed down by the spat with the United States and wider concerns about the country's stalling economy.

It was supported by news of a planned conference call on Thursday in which the finance minister will seek to reassure investors concerned by Erdogan's influence over the economy and his resistance to interest rate hikes to tackle double-digit inflation.

Russia backs using national currencies, not the U.S. dollar, in its trade with Turkey, Russian Foreign Minister Sergei Lavrov said on Tuesday, but he made no firm commitments that would immediately help Ankara to weather its currency crisis. "We will protect our economic independence by being tight knit together", he told members of his AK Party in a speech.

Dimitris Tsarouhas, an assistant professor in the department of global relations at Bilkent University in Ankara, said: "Turkey remains a North Atlantic Treaty Organisation country and, from a military perspective, this limits its ability to manoeuvre in search of new alliances".

What's happening to Turkey's currency?

Brunson is at the moment under house arrest.

The move came as part of the US' reaction to Turkey´s two-year-long detention of an American pastor over terrorism charges.

The second is that Erdogan would have to bury his hatchet with the United States, which remains the IMF's largest shareholder.

The currency has now stabilized at around 6.50 lira against the dollar.

It's unclear how such a boycott would work, and the State Department said it couldn't confirm "that that is actually going to happen", according to spokesperson Heather Nauert.

Policy makers need to adopt a series of measures "so that the situation doesn't make permanent damage to the real economy", the Union of Chambers and Commodities Exchanges of Turkey and the Turkish Industry and business Association said in a joint statement.

With the diplomatic spat with the US showing no signs of letting up, Erdogan will be speaking with German Chancellor Angela Merkel on Wednesday and French President Emmanuel Macron Thursday, his spokesman Ibrahim Kalin said in Ankara.

His call met a mixed response on Istanbul streets.

Tit-for-tat measures with the USA have prompted suggestions that Turkey may actively seek a fundamental change in its strategic orientation - from the West to the East - with the capital Ankara's relations with the West at an all-time low since the failed military coup in 2016. The currency's climb followed retaliatory tariffs by Ankara against USA goods including rice, coal and cars. See if you can take her iPhone away.

Erdogan, however, did not announce any government action towards a boycott.

The currency drop is particularly painful for Turkey because it has accumulated a high debt in foreign currencies. Last October, the Turkish and Iranian central banks formally agreed to trade in local currencies after using the euro for settlements in the past. This has caused the dollar to increase, the lira to fall, and Turkish bond yields to rise.

In addition, the US has placed sanctions on two Turkish ministers over the arrest of an American pastor who is charged with having links to terrorism.

Even though a meeting between National Security Adviser John Bolton and Turkey's USA ambassador on Monday yielded no public progress, the White House is now leading the talks with Turkey over Brunson's release and a host of other issues that have dragged down the alliance.

Ankara has repeatedly said the case is up to the courts and a Turkish judge moved Brunson from jail to house arrest in July.

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