Turkish lira plunges as Trump hits Ankara with increased tariffs

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In what appears to be a diplomatic riposte, Turkey later said Erdogan had held a phone call with Russian President Vladimir Putin to discuss economic ties.

Putting a 50 percent tariff on a foreign country's steel exports isn't the most conventional way to secure an imprisoned American's relief.

The lira tumbled 13% in one day, to 6.51 per U.S. dollar, a massive move for a currency that will make the Turkish poorer and further shake global investors' confidence in the country. Our relations with Turkey are not good at this time!' The U.S. exported $9.75 billion worth of goods-mostly cotton, scrap iron, steel, civilian aircraft parts, coal, and petroleum gases-to Turkey, and imported $9.42 billion worth of goods from them.

Trump decided in March to impose import duties of 25 percent on steel and 10 percent on aluminum imports from several countries, including Turkey.

Now at a new record low, Turkey's currency has lost more than 40% this year.

The numbers have been sliding ever since President Erdogan's election victory in June, with concerns among foreign investors about his control of monetary policy as well as the birth of Turkey's new presidential republic.

Turkey on Friday blasted the Greek defense minister over his remarks against President Recep Tayyip Erdogan on the detention of two Greek soldiers in Turkey.

"The basic reason the exchange rate has gone off the rails is that confidence in the management of the economy has disappeared both domestically and overseas", said Seyfettin Gursel, a prominent economist and a professor at Turkey's Bahcesehir University. But some investors fear the Turkish economy is growing too quickly and could face problems.

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Meanwhile, markets are deeply concerned over the direction of economic policy under Erdogan, with inflation at almost 16 percent but the central bank reluctant to raise rates in response. His comments on interest rates - and his choice of a family member as finance minister - have heightened perceptions that the central bank is not independent.

Turkey, home to the Incirlik air base which is used by U.S. forces in the Middle East, has been a North Atlantic Treaty Organisation member since the 1950s.

He railed against "those waging economic war" against Turkey.

"Those who have dollars, euros or gold under their pillows should go and exchange them into [Turkish] lira".

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

Erdogan, who says a shadowy "interest rate lobby" and Western credit ratings agencies are attempting to undermine Turkey's economy, said Turks should exchange their gold and dollars into lira to help the currency.

The lira "is falling so fast that a parachute is the first thing that comes to mind to prevent the lira smashing into the ground", Bart Hordijk, a market analyst at Monex Europe, told Business Insider.

Relations between the U.S. and Turkey have not been helped by Turkey jailing an American citizen for an alleged attempted coup in 2016. Turkey wants Brunson to stand trial. In addition to the steep drop in the Turkish Lira, which effectively reduces the impact of the tariffs, the USA has so far been unsuccessful in persuading Turkish President Recep Tayyip Erdoğan to release US pastor Andrew Brunson.