Published: Wed, August 15, 2018
Business | By Eloise Houston

Turkey retaliates against Trump tariffs, hiking fees on U.S

Turkey retaliates against Trump tariffs, hiking fees on U.S

There are certain emerging market countries with relatively weak currencies and a heavy reliance on external (predominately dollar-based) financing. Its drop of as much as 18% on Friday hit European and United States stocks as investors fretted about banks' exposure to Turkey.

Turkey's Vice President Fuat Oktay has said Turkey has increased customs duties on some U.S. products including alcohol, cigarettes and cars in retaliation to Washington's tariffs on Turkish aluminium and iron.

The dollar hit another 13-month high against a basket of major currencies on Wednesday as safe-haven demand rooted in fears over fallout from the Turkish lira's recent drop boosted the US currency.

The lira was supported by remarks from Turkish Finance Minister Berat Albayrak, who told a news conference the currency will strengthen.

"Together with our people, we will stand decisively against the dollar, forex prices, inflation and interest rates".

The United States imposed sanctions on two Turkish government ministers over the trial on terrorism charges of U.S. evangelical pastor Andrew Brunson in Turkey, and last week Washington raised tariffs on Turkish metal exports.

While still nominally allies, the USA and Turkey's relationship is continuing to fall apart amid new economic penalties in the continued fight over an American pastor detained in Turkey.

Donald Trump doubled import duties on steel and aluminium as part of fresh sanctions on the country last Friday. The White House announced sanctions on the Turkish justice and interior ministers, prohibiting U.S. citizens from doing business with them.

"The administration is going to stay extremely firm on this".

The political spat with Washington has added to pressure on Turkey's currency, the lira, which has plunged against the dollar.

Chanting "Damn America", they unfurled a banner saying "we will win the economic war", the Demiroren agency said. On Tuesday, he said Turkey would boycott US electronic products. He suggested Turks would buy local or Korean-made Samsung phones instead, although it was unclear how he meant to enforce the boycott.

Brunson was arrested in October 2016 during a nation-wide purge of suspected dissidents following the aftermath of a failed coup in July 2016. See if you can take her iPhone away.

Erdogan has said that he thinks the lira would stabilize, but investors are not convinced.

In a joint statement issued on Tuesday, the industrialists' group TUSIAD and the Union of Chambers and Commodity Exchanges called on the government to allow the central bank to raise interest rates to help overcome the currency crisis.

President Erdogan said on Tuesday that Turkey was taking measures to stabilise its economy and should not "give in to the enemy" by investing in foreign currencies. The steps spurred a 3% gain in the lira to 6.1648 per dollar by 1:56 Istanbul, after an 8.4% advance on Tuesday.

Relations between the two NATO allies have plummeted in one of their worst crises in decades as Trump tries to secure the release of Brunson, an evangelical pastor from North Carolina being tried in Turkey on espionage and terrorism-related charges.

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