Trump doubles steel and aluminium tariffs on Turkey as lira nosedives

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The recent sell-off in the lira has been fuelled by investor concerns over Erdogan's grip on monetary policy under a new powerful executive presidency and the ongoing row with the United States.

The lira dropped by over 11 percent in value in one day on Friday morning to almost six lira per dollar.

World stock markets fell Friday, particularly in Europe, as investors anxious about the financial stability of Turkey, where the currency has nosedived.

The decline has also hit European stocks today, with the Stoxx Europe 600 falling three per cent earlier on today.

The currency, which traded 4.7 to the dollar a month ago, has now weakened to 6.4 to the dollar, having lost more than 30% of its value this month, 20% of which accrued in the last 24 hours.

"Our relations with Turkey are not good at this time!" he wrote.

Turkey's financial crisis and further USA pressure spurred more concern among investors as fears appeared to spread to American markets. Financial upheaval risks further destabilising an already volatile region.

Turkey said it would respond to the new US tariff action "without delay" and warned the move would further harm relations between the two countries.

Trump decided in March to impose import duties of 25 percent on steel and 10 percent on aluminum imports from several countries, including Turkey. He threatened the U.S. with an "Ottoman slap" if they continue to stand in the way of the Turkish incursion into northwest Syria.

Turkey's trade minister says Turkey is "deeply disappointed" by the decision.

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Turkey and the United States squabbled last week over Turkey's failure to free a USA pastor named Andrew Brunson from house arrest while he awaits his trial on terrorism charges. He denies the charges.

Graphic: Emerging market currencies slide. As the lira falls in value, the debt becomes harder to pay.

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 tone echoed that of a speech given on Thursday when he told supporters that "if they have dollars, we have our people, our righteousness, and our God". "This is a domestic and national struggle".

"Some countries have engaged in behaviour that protects coup plotters and knows no laws or justice", he said.

Trump tweeted. Washington's relations with Ankara "are not good at this time", he added.

"Before it is too late, Washington must give up the misguided notion that our relationship can be asymmetrical and come to terms with the fact that Turkey has alternatives".

Erdogan said Turkey is not afraid of outside "threats".

The Turks have also restricted American use of the Incirlik Air Base. It is host to a critical part of the Western alliance's missile defence system against Iran.

USA support for Kurdish rebel groups fighting Islamic State fighters in northern Syria.is another major difficulty, given Turkey's battle against a Kurdish insurgency in its own country. "You are exchanging your strategic partner in North Atlantic Treaty Organisation for a priest".

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