Turkish lira tumbles to fresh low

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President Donald Trump administration announced that it would higher the tariffs on Turkish steel and aluminum over the detainment of American evangelical pastor Andrew Brunson, who was arrested in 2016.

Trump said Friday on Twitter that he authorized a new 20 percent tariff on aluminum and 50 percent tariff on steel from Turkey.

He declared: "Our relations with Turkey are not good at this time!"

Ankara and Washington, NATO allies, have been at loggerheads over the detention in Turkey of United States evangelical pastor Andrew Brunson on terrorism charges, prompting United States sanctions on two of Erdogan's ministers and threats of trade restrictions.

It had been billed as a state visit that would patch up frayed ties between two North Atlantic Treaty Organisation allies and potentially serve as a platform for Turkey to make overtures toward Europe after months of strained relations.

Trump tweeted on Friday that he would be doubling existing tariffs on steel and aluminum imports from Turkey.

Turkey's woes have been aggravated by investor worries about the economic policies of Mr Erdogan, who won a new term in office in June with sweeping new powers.

'If there is anyone who has dollars or gold under their pillows, they should go exchange it for liras at our banks.

Paul Greer at Fidelity International said dramatic interventions were now needed as Turkey faced a "downward spiral" of investor confidence.

"This will be my people's response to those who have waged an economic war against us", he said.

That turned into a rout on Friday, with the lira diving as much as 18 percent at one point, the biggest one-day drop since Turkey's 2001 financial crisis.

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Erdogan said that there were "various campaigns being carried out" against the country.

As the crisis swelled he told his supporters not to worry.

The lira fell 7% against the dollar to 5.9655 on Friday morning after hitting an all-time low earlier in the session.

Erdogan also Friday held telephone talks with Russian President Vladimir Putin, discussing economic and trade issues as well as the Syria crisis, the Turkish presidency said.

In modern economies, central banks are meant to be independent of governments to make sure they set policies that are best for the economy, not politicians.

"When it comes to cornering Turkey to extract certain concessions that undermine our sovereign rights, it is a whole another story".

Erdogan had raised eyebrows Thursday when he appeared to invoke divine intervention, saying: "If they have dollars, we have our people, we have our right and we have Allah!"

The president has declared that American importers' reliance on foreign metals poses a national security risk to the USA, and he also has increased the cost of these imports on Japan, Turkey and members of the European Union, the paper reported.

The slump is attributed to the tensions with the United States and concerns about President Recep Tayyip Erdogan's control of monetary policy. "The tweet is mightier than the Turkish sword", Cristian Maggio, head of emerging markets strategy at TD Securities, said in a note to clients, with reference to Trump's comments.

BBVA, which reported a lowly CET 1 ratio of 10.8 percent at the end of the first half, also said a 10 percent slump in the lira would shave 2 basis points off its core capital.

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